Point-of-Service (POS) plans include an EPO for in-network coverage but also allow insured to go out-of-network and visit the provider of their choice. The out-of-pocket cost while using an in-network provider through the EPO will be much lower than using an out-of-network provider as all services and providers have agreed to reduced fees.

Out-of-network services are typically reimbursed at a specific coinsurance level (typically 70% to 80%) after satisfying a deductible. Maximum allowable charges for out-of-network services are limited to a specific percentile of “reasonable & customary” charges or as a percentage of medicare allowable charges (eg 150% of Medicare).

Preferred Provider Organization (PPO) plan consists of a network of health care providers that an insured member has complete access to without referrals. PPO networks are typically significantly larger than EPO networks and provides insureds with a much greater choice of providers. An insured member also has access to providers outside the PPO network. 

Health Saving Account (HSA) compatible medical plans entered the market as a different means of controlling employer medical insurance costs.  These are called High Deductible Health plans or Consumer Driven Healthcare plans. CDH plans have a “high deductible” that the member must meet before the insurance coverage “kicks into play”.  Office visits, prescriptions, hospitalization, etc. all go towards the deductible first.  After the deductible is met then then plan behaves like a traditional medical program.  Typical copays for office visits and prescriptions take effect after the deductible has been satisfied.  The exception to this is preventive care which under Health Care Reform is covered at 100% immediately.

Tied to the CDH medical plan is a Health Savings Account (HSA).  The HSA is the employees personal account and any funds in the account always belong to the employee regardless of whether the account was funded by the employee or the employer.  The employee uses the funds from the HSA to pay for any out-of-pocket expenses such as deductible, copays, coinsurance and the lengthy list of items and services allowed under a Flexible Spending Account (FSA).

When designed properly, CDH plans encourage employees into making more cost efficient care decisions. CDH plans require proper planning, and implementation.  Employee education is a critical component to the success.  The Broad Reach Benefits Team has extensive experience designing and implementing these programs.  We’ll assist you and your employees through every step of the process.

Whether you have 30 or 1,000 employees, provide your employees with a choice of medical plans, not just a one-size fits all plan.

Employees are diverse in skills, personalities and their insurance needs. Offering employees a choice of medical plans creates an opportunity to best meet the needs of your employees and assists in lowering the employers overall costs.  While younger and/or healthier employees may prefer a lower costing EPO other employees may still wish greater freedoms of provider choice and are willing to contribute higher payroll deductions for that option.  Employee contribution levels can be set to create “steerage” to the lower costing EPO plans without reducing benefits.

Providing employees with a choice of programs will save the employer money while empowering the employees.