Medical Plan Basics
Today, buying health insurance is anything but simple. With a growing array of new policy choices, the arrangements you make for funding Physician Health Plan expenses will directly affect the way your care is delivered. Along with new scientific discoveries that have improved the detection and treatment of illnesses, the cost of healthcare has risen astronomically in recent years.
Most people are covered by some form of medical care issued through their employer or their spouse's employer. However, a "typical" group medical insurance policy is impossible to describe because of the many coverage variations found in the marketplace today.
The Move to Managed Care
Because of increasing medical care costs under the traditional indemnity system, in recent years many employers have found more cost-effective ways to finance care for the employees of their company. This trend resulted in a movement toward "managed care" plans, which promote more efficient use of medical services in order to contain treatment costs.
The two major types of managed care systems are health maintenance organizations (HMOs) and preferred provider organizations (PPOs). These organizations come to terms with physicians and medical facilities to control healthcare quality and costs; create financial incentives for subscribers to use the contracted physicians and facilities; and require providers to bear some financial risk for the physician health plans.
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