What is meant by EPO in health insurance?
“To sum it up…”
- There are many types of managed healthcare organizations
- The EPO is a type of managed care organization
- They all involve health care resources called networks
- They have different ideas about using health care resources
- They have rules concerning customers use of outside resources
The EPO or exclusive provider organization is a network of doctors, and medical service providers joined into a simple arrangement. Clients have access to all of the network resources but cannot get insurance coverage when they go outside of the network.
The goal of the EPO approach is to keep prices low for the customer and hold down out-of-pocket expenses. The Customer can clearly control when they wish to incur the costs of using a doctor or facility that is not in the EPO network.
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The Price of Outside Services
EPO customers benefit from having quality medical care ready and waiting for them at an agreed cost sharing range. They will bear the costs of outside services. The expense may or may not count towards the out-of-pocket maximum in the plan.
Comparison shopping is a great way to evaluate the private insurance plans in Part C Medicare Advantage, Medicare Supplement, and the prescription drug benefits in Medicare Part D.
What is a Network
A network in healthcare is a group of medical professionals and medical care facilities. Doctors, clinics, and hospitals are import parts of healthcare networks. The managed care organizations recruit professional to join their networks. This involves agreeing to take member patients and agreeing to a pricing structure for services.
Doctors and others in the network benefit by having a stream of patients directed to them through the plan membership.
Types of Managed Care
The original health maintenance organizations advocated for prevention and wellness services. They used a model that restricted consumer choices to the network resources. In the list below, the items describe the major types of managed care organizations and their main features.
- HMO is the health maintenance organization. The HMO uses a primary care physician to provide care and refer to other resources when needed. The basic HMO does not pay for resources outside of its network
- PPO is the preferred provider organization. It offers greater choices to customers than the HMO. PPO customers do not need referrals to network resources, and they can use outside specialists. The PPO pays less when customers use outside resources.
- EPO is the exclusive provider organization. This type of managed care organization uses a network of doctors and medical facilities. It does not provide coverage for members when using resources outside of the network.
- HMOPOS is the point of sale option for a health management organization. The HMO uses a primary care physician to make referrals as needed to network resources. The POS option allows the primary care physician to make referrals to outside resources too. The insurance pays for the outside referrals as a lower percentage than with in-network referrals.
- PFFS is the private fixed fee for services organization. This is a simple form of managed care based on agreements with medical services providers to accept a negotiated fee. The agreements set the customer and insurance shares for the services
The Exclusive Provider Organization
The EPO is an important type of healthcare network. It works in Medicare as well as Marketplace health insurance. Its principle difference is that the members must use network resources to get insurance coverage and to reach the plan’s deductibles and out-of-pocket limit.
Comparison shopping is a great way to compare EPO plans with other EPO plans or with other types of plans. Whether looking for Medicare Advantage or a smaller prescription-only plan, comparison shopping can focus on the features that matter most.
The design of the EPO tends to hold down out-of-pocket expenses. The premiums and copays are low, and the network only resources requirement tends to keep consumers away from costly services. If an EPO client goes outside the plan, they must pay the entire bill.
The hidden item for many consumers is that the outside services they purchase do not count towards the out-of-pocket maximum. The out of pocket maximum is the tipping point after which the insurance company pays 100 percent of an essential benefit.
The organization brings freedom within the network to choose services. It also gives members freedom to go outside of the network and control their spending as they choose.
The EPO insurance coverage discourages outside resources; it counts those out-of-pocket funds as if they did not exist. This counting method, in effect, raises the out-of-pocket maximum by the amount consumers spend outside of the network.
Obamacare Limits Out-of-Network Expenses Too
The Affordable Care Act sets limits on the total amount of out-of-pocket expenses a given policy can charge in one year. For 2017, the out-of-pocket maximum cannot exceed $7,150 for an individual or $14,300 for a family unit. The rules set the maximum for deductibles for one year. In 2017, it is the same amount.
Comparison shopping is an excellent tool for finding the value and costs of a health insurance policy. Using comparison shopping, consumers can focus on the costs that matter most to them.
EPO in the Marketplace
The EPO is a less frequently found type of marketplace plan. Not as common as HMO or PPO. The EPO approach is similar to an HMO in that it uses network resources add does not cover outside resources.
Unlike the HMO, the EPO does not require referrals for network services. The EPO marketplace plans permit using outside resources in emergency situations such as when away from home or simply out of the network service area.
EPO in the Obamacare Plans
Consumers can get EPO managed care in the four metal bands. These plans permit no outside resources and only use network doctors. They permit the use of outside resources in emergency situations. The below-listed descriptions show the basic cost sharing on Obamacare EPO plans.
- Platinum EPO plans cover about 90 percent of the benefits’ costs and leave ten percent for the consumer. The premiums are high, and the deductibles are low and reachable.
- Gold EPO Plans cover 80 percent of benefits costs and leave 20 percent for the customer. The Premiums for Gold plans are high and the deductibles in the lower end of the range. These are plans designed for those with a significant amount of medical care needs.
- Silver EPO plans cover 70 percent and divide the 30 percent balance for the consumer. Some silver plans have high-deductibles, and these are ideal for pairing with Heath Savings Accounts to reduce the impact of deductibles.
- Bronze EPO plans have low premiums and high deductibles. The divide costs with consumers on a 60 percent to 40 percent basis. The deductibles are unlikely to be reached unless a severe level of usage occurs. These plans are ideal for those whose needs are for annual physicals, preventive services, wellness, and periodic visits.
EPO in Medicare
Some Medicare Advantage plans use EPO networks to manage care for their clients. EPO managed care limits customer choices to the network resources. The customers do not need to see a primary care Physician. Customers control when and how often they go to outside resources.
Medicare Services for Older Americans
Parts A and B make up Original Medicare. The basic choice is whether to use the government-run original or the private insurance plans of Medicare Advantage. Medicare consists of the below-listed major programs for senior health care.
- Part A Hospital Insurance is the primary Medicare program for older Americans. Administered by the federal government, it provides inpatient and outpatient hospital care. It covers services and equipment needed to treat a disease or condition.
- Part B Medical Insurance is the medical partner for hospital coverage in Part A. Together, they form Original Medicare.
- Part C Medicare Advantage is the private version of Original Medicare. Private insurers submit plans for approval by the CMS. These plans must meet or exceed the coverage of Original Medicare.
- Part D Prescription Drugs are private plans that cover the costs of medicines.
Medicare Supplement is a type of plan that helps with the twenty percent customer share of Part B benefits. The Part B Medical Insurance in Original Medicare leaves an eighty percent to twenty percent costs sharing split with consumers. Medicare Supplement can pay all or a significant part of these charges.
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