Insurance and Third Party Payers - Essay Example

"Insurance and Third-Party Payers" is a wonderful example of a paper on the health system. Health insurance is very supportive for people as it facilitates people to pay reduced or negligible amounts for medical problems that occur to them. The risky health care expenses can be managed with the help of health insurance. There are many health care programs offered to people in the lieu of health insurance among which, HMO (Health Maintenance Organization) insurance programs and PPO (Preferred Provider Organization) insurance programs are prominent. This paper compares HMO and PPO insurance programs in terms of their advantages for the insurers.

Under the HMO insurance program, the beneficiary is entitled to receive health care from a network provider that is fixed. The entitled beneficiary is allowed to select a primary care physician (PCP) for the provision of health care services. The primary care physician is held accountable to synchronize and administer the health care to be provided to the beneficiary (Kongstvedt, 2012). The PCP also takes care of the health needs of the entitled person and in case, the PCP cannot provide the required health care, he can refer the person to some other doctor. Health insurance under the HMO program is also regarded as low cost as compared to other conventional health insurance programs (McGuigan & Joseph, 2012).

Unlike the HMO insurance program that has a restricted network to opt from, the PPO insurance program facilitates the entitled beneficiary to opt from a number of preferred health care providers from the PPO network or from any other network. David Lepak (2009) defines PPO as a category of health care insurance program, which supports the beneficiary to get an opportunity to gain access to low costs for health care, as the employers of the beneficiary are able to discuss the costs and services with the health providers.

An HMO health insurance, the beneficiaries must have a PCP and without a PCP, health care coverage will not be provided. However, under PPO health insurance, the beneficiaries can be helped out by any health provider but if the health provider is not from the preferred list, the beneficiaries are required to pay higher (Kongstvedt, 2012). In case, any specialist is required for dealing with some health issue, the HMO insurance program allows the PCP to refer to the specialist from the HMO network while in the PPO insurance program, referring is not required. According to David (2009), HMO insurance programs have low premium rates as compared to PPO insurance programs. Moreover, in the HMO program, the involvement of PCP is essential for referring process while in the PPO program, PCP’s involvement is optional.

I would prefer the HMO insurance program because this health insurance program restricts the beneficiaries to have a primary care physician who knows about the health problems that a person can have. He also keeps knowledge about specialists who have in-depth knowledge about specific diseases. This kind of focused assistance is good for people requiring specialized assistance. The foremost difference between HMO and PPO is the selection of PCP, which is essential in HMO and optional in PPO. In totality, both kinds of insurance programs, HMO and PPO are beneficial as the entitled people are able to get health care services at reduced costs.

 

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