What Type of Health Plan Is Best For Me?

Most plans fall into six basic categories: traditional health insurance, Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), Point-of-Service plans (POSs), and Exclusive Provider Organizations (EPOs) and Health Care Savings Accounts (HSAs). But there are also differences between plans of the same basic type (for example, not all HMOs are the same), so be sure to read all materials provided by your employer and the health plan carefully.

Traditional Insurance

Traditional health insurance is generally the most flexible type of health plan. It allows you to choose any doctor you want to and see specialists without getting approval from a "primary care physician" or "gatekeeper" first. However, depending on the plan, certain restrictions may apply. For example, you may need to get the insurance company's approval before checking into a hospital, unless it is an emergency. With traditional health insurance, you will usually have to spend a certain amount on medical bills each year before your insurance starts to pay. This is called a deductible. After that, you will have to pay a percentage of each charge, called a co-payment. The insurance company will pay the rest of the charge, generally based on what it considers reasonable. Many insurance plans protect you from large medical expenses by limiting your total expenses in any given year, called your out-of-pocket expenses. There may also be a cap on total benefits--a maximum amount the insurance company will pay in your lifetime.

Traditional health insurance is generally more expensive than other types of health plans and may require you to do more paperwork to file claims.

Traditional insurance companies are regulated by the California Department of Insurance.

HMO (Health Mainten