Health insurance plans generally fall into one of two categories: Indemnity Plans (also known as reimbursement plans) and Managed Care plans such as health maintenance organizations (HMOs), preferred provider organizations (PPOs), and Point of Service Plans (POS).
No matter which type of health insurance plan you buy, you need to make sure it offers the right kind of coverage.
* Managed Care plans generally provide broader coverage, but they all involve an arrangement between the insurer and a selected network of healthcare providers (doctors, hospitals, etc.). For example, an HMO will require that a primary care physician in the network coordinate all of your care and refer you to specialists in the network.
* An Indemnity Plan allows you to choose your own doctors and pays for your medical expenses totally, in part, or up to a specified amount per day for a specified number of days.