| PPO: | | | | $350-$400.00 in a PPO type-scenario, forcing |
| When a person has an HMO, they have an | | | | insurances to bump up their premiums |
| assigned medical group. The medical group is | | | | POS: |
| contracted with their health insurance carrier | | | | A point of service plan is also very costly to |
| (Aetna, Blue Cross, Blue Shield, Connecticut | | | | insurance companies. The only reason POS plans |
| General, United Health, etc.). Thehealth insurance | | | | have been successful is because people who have |
| funds the medical group a certain amount of | | | | HMO's (medical groups) will oftentimes go out of |
| money every month in exchange for services by | | | | their network, and see a doctor of their choice |
| the medical group (this is known as capitation in | | | | not contracted with their insurance company. The |
| the industry ) to their subscribers. | | | | POS gives people the option to "opt-out" (this is |
| Because of this contract: insurances save billions | | | | what it's known as in the industry), and see a |
| of dollars a year. An office visit which costs | | | | doctor of their choice. Again, the same scenario |
| $500.00 for example, will be discounted to about | | | | applies. If most people stayed in their medical |
| $45.00 in an HMO type-scenario. In a PPO | | | | group (HMO side of their POS plan) instead of |
| type-setting, the insurance will have no choice but | | | | opting out and seeing a doctor of their choice |
| to pay 80/20% or 90/10%; the same office visit | | | | who is not contracted with their insurance |
| which costs the insurance company $45.00 under | | | | company, insurances would save billions of dollars |
| an HMO contract, could cost them upwards of | | | | a year, and monthly premiums would be reduced. |