When choosing a health insurance plan, we often stumble upon POS and PPS, so what are they exactly? And which one is better?
What is a POS health insurance plan?
Point of service health plans is a type of insurance plan that is a hybrid of both health maintenance organizations (HMO) and preferred provider organization (PPO) plans. POS is based on a managed care foundation meaning lower cost when receiving medical services but at a limited price.
What are the benefits of a POS plan?
When enrolling in a POS plan, clients are required to choose a primary care physician of their preference; this person then becomes their Point of service (PCP) that offers great deductions on their services. When choosing POS, clients can expect the following Pros:
Deductibles: POS plans often come with no deductibles.
Coinsurance: Unlike PPS, which only allows coinsurance after paying a deductible, POS clients benefit from having coinsurance available without any deductible if referred to out of network.
Premiums: When it comes to paying a premium for insurance providers, PPS plans are much higher, unlike POS, which offers a lower-cost premium.
What are the disadvantages of POS?
Due to the nature of POS plans, they are bound to have some shortcomings, and some of them are:
Price: Although POS premiums are cheaper than PPS’s, POS premiums are more expensive than an HMO premium.
Limitations: Having a single PCP is limiting; clients are boxed to stay in the network, with a heavier price tag when referred outside the network.
Copay: POS clients often are expected to copay; to put it simply, POS clients are expected to pay for a medical visit or a medical prescription.
Referrals: POS clients need a referral by their PCP if they require further treatments for a reduced price.
Which is better POS or PPO?
POS and PPO seem closely similar; however, they both have vastly different bases. POS requires you to seek network related facilities and referral treatments and visits for insurance to apply; although cheaper POS than PPS, it is also more Limited. POS has no deductibles and, depending on how you view it, choosing a PCP is either a good thing or a bad one.
PPO short for participating provider organizations is a large network of doctors, therapists, and other health providing facilities that have agreed to provide a reduced price to clients from specific insurance companies.
PPO is pricier than POS from a premium and a deductible cost; however, it comes with much more flexibility and the option to stay out of network and in the network simultaneously. It also doesn’t require its clients to choose a PCP giving them the freedom of choice.
In terms of who’s better than the other, we can’t say. Depending on the client’s needs and choices, they might prefer PPO over POS or vice versa. For more information on which plans fit you better, you can check Theartofinsurance.org.
Regardless of its cons, POS remains a solid option with a reasonable price tag for insurance, although limiting, services are at a much lower price.