Health Insurance – Decoding the Different Plan Types

With such a variety of Texas health insurance available on the market, it’s important to learn the “code” and be informed about the difference between each type of plan. Rules and rates are constantly changing, and upcoming government legislation could change the game even further. For now however, there is a set terminology to describe very simple differences between plan types. Every Texan should become informed about their choices, because the peace of mind of good health is priceless.


There are three main types of managed health care plans, which is the most popular form of Texas health insurance. The first type is through “preferred provider organizations,” or PPO’s. The PPO forms a network of preferred health care providers that a member of this plan can choose from to visit. A member pays a co-pay of some small dollar amount to visit any member of the network, but by contrast if someone wants to visit a doctor outside of the network he or she would have to pay some sort of deductible or submit lengthy paperwork. If one is happy with the doctors that are in-network, this can be a cost effective and user-friendly health care program.


The second type of Texas health insurance falling under the managed health care umbrella are “point of service” plans, or POS’s. There is not that great of a difference between the PPO and the POS. For the most part, the only real difference is that in a POS the member has to choose a primary care physician, who will then be the person that offers referrals to other specialists, be they in or out of network. If they are out of network, this will most likely also mean that the consumer will have to spend more money out of pocket.


Finally, there are “health maintenance organizations,” or HMO’s. These are the most bare-boned, but usually the most cost-effective type of managed health care plan. There is no choice really between in or out of network doctors. You are allowed to see any doctor that is part of the HMO network for free or a small co-pay, but if you stray to any other doctor outside of this network you will have to pay for all of it, as it is not included in any part in this type of Texas health insurance. As a benefit to the simplicity of this plan, however, there is little paperwork, and greater access to preventative health services. To learn more about managed health care options in Texas and how they could improve your life, contact your local independent insurance agent.