EPO in Health Insurance

What are EPO Health Plans

An Exclusive Provider Organization (EPO), is a health plan that requires subscribers to access specialty care (without referral) only from local “in-network” doctors and hospitals (Just like HMOs).

EPOs are usually pocket-friendly and the monthly premiums are way less in comparison to PPOs (but with high deductibles). However, care is not accessible to “out-of-network “providers except in emergency cases.

EPOs usually work well when offered as an addition to the employee benefits package.

How EPO works

• With an EPO, care is only accessible when you seek treatment from facilities contracted with the health insurance company known as “in-network.” Any health care offered “out-of-network” is not eligible for payments (only a few exceptions-emergencies)
• The majority of EPOs do not require their members to select and stick to a Primary Care Physician (PCP). However, this freedom can work against subscribers with chronic illnesses or conditions that require continuous monitoring by a PCP.
• Subscribers are not expected to seek any referral to access “in-network” specialists. However, pre-authorizations may be required for certain medical procedures and treatments. This is a way for the insurance company to limit unnecessary visits to care providers.
• EPOs are stress-free and very low maintenance. Subscribers are not required to file claims on their own. This is due to the fact that all care is provided in-network and the in-network healthcare provider will automatically bill the EPO health plan for any medical services rendered to their subscribers. Under EPO arrangements, subscriber duty is limited to payments of copayment, coinsurance, and deductible.
• When subscribers visit an “in-network” service provider for care, the insurance company will offer cost sharing for any amounts spent on your treatments and other services. They will cover the biggest portion with the subscriber expected to cover the difference in form of deductibles, copayments, and coinsurance. Your portion solely depends on the type of plan you subscribed to.

Pros and Cons of EPO Health Insurance

Pros

• Affordable monthly premiums: EPOs are generally less costly in comparison to PPO plans, though higher than HMOs.
• Easy access to specialty care: It is not a requirement to get a referral to hence visiting specialists like a cardiologist or physical therapist.
• No need to choose a PCP: Most EPOs do not require their subscribers to choose a PCP and stick with them for the plan year.

Cons

• Network limitations: any “out-of-network” cost is not covered except for emergency care. The subscribers are expected to cater fully to any “out-of-network” cost
• Cost sharing: Most EPOs offer cost-sharing (deductible and coinsurance), This Out-of-pocket costs are specific to the plan or tier selected.

EPO versus PPO

The similarities are;

• Referrals

Both PPOs and EPOs do not require referrals for specialty treatment.

• PCPs

Both plans do not require their subscribers to choose a primary care provider (PCP). EPOs may often require their members to choose a PCP but not always.

• Cost Sharing

Subscribers to both plans are usually subjected to deductibles. These are the payments that are made before out of pocket before coverage begins.

The differences are;

• Networks

PPOs offer a larger network (in-network or out-of-network) in comparison to EPOs hence more doctors and hospitals to choose from. However, most PPOs will provide some coverage for out-of-network services, while EPOs will only provide cover for in-network care only, except in emergencies.

• Costs

PPOs are more expensive than EPOs when you compare the average monthly premiums.

• Out-of-pocket costs

Due to access to a bigger network, PPOs usually have a higher Out-of-pocket cost when compared to EPO plans.

• Monthly premiums

PPOs come with higher monthly premiums when compared to EPOs. This opens greater flexibility when it comes to picking a physician and other health care options.

EPO vs HMO plans

The similarities are;

• Networks

Both HMOs and EPOs offer a local network of doctors and hospitals for subscribers to choose from. The two also do not offer Out-of-Network Coverage for routine care. Only medical emergencies are covered under EPOs.

• PCPs

HMOs require their members to work with a PCP to coordinate care. EPOs also may require their members to choose a PCP but not always.

The differences are;

• Costs

EPOs are usually more costly than HMOs, given the fact they do offer slightly more flexibility.

• Referrals

With HMOs, you have to use your PCP to coordinate your medical care and make referrals for any specialist visits. In contrast, EPO members are free to see specialists without a referral (some cases may require prior authorization).

Bottom line

EPOs usually end up being the preferred plan when compared to other plans in terms of cost, choice, and flexibility.

HMOs may be cheaper but you have to work with a PCP who is allowed to offer referrals to specialists. On the other hand, PPOs may offer more flexibility in terms of in-network and out-of-network care are far more costly.

Considering all factors, EPOs will always be the “middle ground” in terms of rates and quick access to specialists.