POS in Health Insurance

What is POS Health Insurance

A point-of-service (POS) is a type of Health Insurance Plan, with hybrid features of an HMO (Members are required to designate an in-network PCP) and PPO (On referral, members are allowed to receive care outside of the provider network).  POS Subscribers can make use of its hybrid nature different depending on whether their intention is to maximize the in-network or out-of-network providers.

Being a hybrid, expect its pricing to be somewhere in the middle. POS plans will attract higher premiums when compared to HMO plans but will be less costly when compared to PPO plans.

POS plans tend to be unique and will come with different terms. However, the following are standard across most plans;

• The subscriber is responsible for filing paperwork for claims on care provided out-of-network
• Copayments are higher for out-of-network care.
• The subscriber is expected to meet the deductibles before accessing out-of-network coverage care. Payments of deductibles are not a requirement for in-network care.

HOW POS works

POS is considered as some sort of hybrid of HMO and PPO plans.

The subscriber will be required to choose a PCP for primary care (preventive care, annual checks and physicals, and normal sick visits) and is the one to make referrals to network specialists if needed. Typically, Services provided by the PCP are not subject to any deductibles.

Care is also accessible from out-of-network providers but with higher out-of-pocket costs. The member is responsible for co-payments, coinsurance, and annual deductibles.

When is a POS Plan right for you?

• The subscriber is willing and ready to play by POS rules which includes coordinating care through a PCP.
• The PCP is already a participant in the POS network

POS Health Insurance pros and cons

PROS of POS Plans

• Lower monthly premiums compared to PPO plans (up to 50% cheaper).
• Freedom and comfort in seeking treatment from specialists outside of the approved network and receiving cover from the insurer.
• When receiving care from in-network providers, the subscriber will be charged very low co-pays (In network office visits typically range from $10 to $20), zero deductibles and no paperwork. This is nearly half the charges of a PPO.
• Fits well with traveling as care is always available outside your geographic area.

CONS of POS Plans

• Higher monthly premiums compared to HMO plans (up to 50% more expensive).
• The expectations are referral for any specialist treatment will be within the approved network.
• Subscribers have to meet the deductibles before care is accessible from out-of-network providers.
• Copayments are significantly higher when receiving care from an out-of-network provider (Expect to pay between 30 to 40 % in Copays).
• The task of completing and filing the paperwork lies squarely on the member when they seek care outside of the network. They are also expected to coordinate onward payments to the same provider. Remember-providers fees have to be paid upfront.
• POS plans tend to hold a relatively small market share compared to other plans. This makes POS plans less visible as they are rarely less aggressively marketed.

POS Health Insurance vs PPO

In a nutshell, the biggest differentiator between POS and PPO plans is flexibility.

PPOs are less restrictive when it comes to visiting a doctor you want but at a higher cost. POS on the other hand is associated with lower premiums but is restrictive on choices.

The details below are handy if you need to make a detailed comparison;

• PCP requirement: POS plans require its members to choose a PCP to coordinate their care.
• In-network requirement/ Referrals to other providers: Subscribers in POS plans will need referrals from their PCP for specialist care from in-network providers.
• Premium Costs: POS plans come with significantly lower monthly premiums when compared to PPO plans. However, PPOs do offer superior options.
• Deductibles and Copays: Members of POS plans are not subject to deductibles for any care provided by in-network providers. However, both plans require copays.
• Coinsurance: For PPOs coinsurance automatically kicks after a member meets their deductible. For the POS plan, coinsurance costs apply only if the member seeks care from out-of-network or did not seek a referral to see other providers.

Before enrolling in any health plan, always set a plan to review the details of coverage.

These comparisons are simply high-level descriptions of PPO and POS plans. Plans do vary widely between insurance carriers and what you can purchase on your from the Health Insurance Marketplace.

Bottom Line

POS health insurance is not necessarily the perfect choice for everyone. It’s a hybrid of HMO and PPO. The user’s choice of plan should be anchored on the user’s medical needs, plan benefits, and income.

HMOs are a popular alternative. Members have access to a large network of providers and facilities that come with pre-agreed fees at a certain level. HMOs are set apart from other covers due to their lower monthly premiums backed by lower copays and coinsurance. HMOs are suitable if the user is in search of affordable coverage for basic medical care (immunizations, occasional medical checkups, etc.), HMO health insurance offers affordable coverage. However, their biggest letdown is their inability to cover any out-of-network care (except emergencies)

PPOs are also another good alternative as they tend to be flexible and with the most coverage. However, PPOs are subject to deductibles and higher costs. They are also expensive when compared with HMOs.

Both HMOs and PPOs may have dental and vision coverage. However, this additional coverage comes at a higher cost.