Understanding Health Care Insurance Companies and Policies

When it comes to health care insurance companies, many people feel as if the insurance companies speak a completely different language. This can make understanding the different types of health care insurance and how each plan functions much more difficult.

Here is some basic information about different kinds of health care insurance policies to help you determine the right plan for you and/or your family.


PPO stands for Preferred Provider Organization and typically consists of a network of providers that includes doctors, hospitals, and specialists. As a member, you can choose from that in-network list of care providers, including specialists and hospitals. If you choose a provider or hospital outside of that network, the insurance company pays less for the associated fees than if you had selected someone within the network.

PPO plans can cost more than other types of insurance company policies but is a good choice for those who see specialists on a regular basis or do not want to go through the hassle of getting a referral every time they see someone other than their primary care physician.


HMO stands for Health Maintenance Organization, and like a PPO, has a network of doctors from which members can choose. However, most HMOs require members to choose a primary care physician from the in-network list, and that primary care physician must provide a referral to see a specialist or hospital in order for the insurance company to pay for those costs.

An HMO usually costs less than a PPO and has a heavier focus on preventative care and wellness.


POS stands for Point of Service Plan. A POS is a blend of HMO and PPO plans, as members pay less money when they select health care providers and hospitals from the insurance company’s network. In addition, some POS plans require a referral from the primary care physician to see a specialist.

Guaranteed Issue

A guaranteed issue health care insurance policy promises acceptance into the plan. This is useful for those who have a pre-existing condition and have been denied coverage by traditional insurance companies due to this condition. However, guaranteed issue health insurance plans can be costly. Research your options thoroughly before you select a guaranteed issue insurance policy.


PCIP stands for the Pre-Existing Condition Insurance Plan, which is a new program under the Health Care Reform Act. This program offers health insurance coverage to those denied health care insurance coverage due to a pre-existing condition and has not had insurance for at least six months or more. The rules and regulations for this program vary by state.

Affordable Insurance Exchange

Another aspect of the Health Care Reform Act is the Affordable Insurance Exchange policy. Under this plan, small businesses and individuals can compare their current health care insurance policy against policies from other insurance companies and change to a different company if desired.

If you are still uncertain about what type of health care insurance you need and what insurance company to select, contact several different insurance companies and ask for a free quote. Gather several quotes before choosing a policy to make sure you get the right plan for you and your family.

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