Group Health Plans

There are four basic types of fully-insured health plans available today:

Health Maintenance Organization (HMO)

These plans provide benefits wholly within a network. The emphasis with these plans is on prevention and having one provider (gatekeeper) monitor and prescribe most treatments. The policyholder must select and be seen by a gatekeeper and then referred by that gatekeeper to a specialist to seek further treatment.

The HMO usually pays the gatekeeper a monthly fee for all patients that select that gatekeeper as their Primary Care Physician (PCP). Keystone, Horizon, Amerihealth and Aetna US Healthcare are examples of HMOs.

Lowest Cost Health Plan
Limited Provider Choice
Provides Wellness & Preventive Care
No Benefits Out of Network
Gatekeeper Monitors Patient Care
Must select PCP
No Claim Forms
HMO Dictates Treatment
Must Get Referral to See Specialist

Point of Service (POS) Plan

These plans have two parts: referred benefits and self-referred benefits.

Referred benefits are the same as an HMO, with the same restrictions: requires gatekeeper, must get referrals, limited network, etc.

The self-referred benefit allows treatment outside the network, but the policyholder will be subject to deductibles and coinsurance. Keystone, Horizon, Amerihealth and Aetna US Healthcare have POS options for their HMOs.

Has Out of Network Benefit
Must Use Gatekeeper in Network
Provides Wellness & Preventive Care
HMO Dictates Treatment in Network
Usually Lower Cost Than PPO
Must Get Referrals in Network
No Claim Forms in Network
Must select PCP

Preferred Provider Organization (PPO) Plans

These plans have two parts: in network benefits and out of network benefits.

The insurer bands together a group of providers who agree to discount their fees because the insurer promises them the potential of many patients. In order to get the policyholder to use the network the insurer provides many low cost benefits, such as $5 office visits and wellness coverage in network.

The policyholder may seek treatment outside the network, but will be subject to deductibles and coinsurance like an indemnity plan. Blue Cross Personal Choice and Fortis Clear Choice are examples of PPO plans.

Expanded Benefits
Must Use Network to Get Expanded Benefits
No Claim Forms in Network
May be Higher Cost than POS or HMO
No Referrals Needed
Network may be Limited
No Gatekeeper or PCP Required


There are two types of Self-funded Health Plans:

Fully self-funded plan means that the employer is totally responsible for all costs and claims of their employees' health coverages. There can be very large savings as long as the claims stay low; if not, then the plan costs can skyrocket. This type of plan should only be considered by large companies (1,000+ employees) who have detailed claims experience.

Partially self-funded, sometimes known as limited self-funded plans provide a mechanism that limits the employers claim liability to a specific maximum amount. Thus, if the plan has low claims the employer saves money; but if the claims are high there is limit to the employers' liability. Employers with as few a 50 employees can consider these plans.

Our associates can provide a detailed analysis as to the feasibility of this type of plan.

For further information on Group Health Plans Contact Us.