Managed care is split into three main categories: Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs) and Point of Service (POS) models. An HMO provides discounted coverage in exchange for requiring the patient to work with a specified network of physicians through the direction of one primary care physician. A PPO allows the patient to go out-of-network for care, but charges the patient less money if they stay in-network. A POS model takes elements of both of these models and adapts them into a plan that gives the patient flexibility while also still allowing them the chance to save money.
How Does A Point of Service Model Work?
In an HMO, the patient must coordinate all healthcare through one primary care physician (PCP), who will refer the patient to other doctors or specialists if they think the patient needs more care than they can provide. The same can be true in a POS model, meaning the patient can still reap the benefits of being part of an HMO even without being completely tied to it. These benefits include cheaper care and more coverage from the third-party insurance organization that contracts the network of healthcare providers. Preventative care benefits may also be available. But these benefits all depend on the contract that the patient agrees to, and a patient may not have to designate a PCP.
In a PPO, the patient is allowed to go out-of-network for care and is not required to go through a PCP to plan treatment, though doing these things come at an additional expense. This is possible in a POS model, too. The patient can choose to pay more money out-of-pocket to see a specialist without consulting their doctor, or can stay in-network and save money.
Essentially, a POS model allows the patient the freedom to choose to be treated through an HMO plan or a PPO plan depending on their needs and preference. Being covered by a POS plan can be more expensive than being covered by an HMO, but less expensive than being covered by a PPO. A POS model allows patients more control over their plans and allows them to determine for themselves which doctors to trust and which treatments will work best.
Why Use a POS Plan?
A POS plan is a good option for patients who want to be able to pick and choose their treatment options, even if that means potentially paying more out-of-pocket. If they want the security of low-cost care through an HMO, they can have it. If they want to be able to go out-of-network to see a specialist or other provider, they can do that and still have at least a portion of their care covered by the plan. They also have the freedom to see any PCP they want, though it will still be cheaper to see one who is contracted in-network.
However, coverage through a POS plan tends to vary according to how the patient chooses to receive their care each time. If they stay in-network, they can expect predictable costs. But if they don’t, they can expect more unpredictable out-of-pocket expenses that are based on the terms of the POS contract and the ways that out-of-network providers do billing.
How DECO Can Help
Medicaid has been using managed care models heavily for its recipients in recent years, and managed care is a common form of coverage that employers provide as part of employee benefits. But it can also be a confusing topic, and if a healthcare organization or its billing staff doesn’t know how to work with it, issues with reimbursement may result. If your healthcare organization needs assistance with understanding healthcare models in order to foster a well-oiled revenue cycle management system, contact us today!
