Point of Service Plan - Explained
What is a Point of Service Plan?
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Back To: INSURANCE & RISK MANAGEMENT
What is a Point-of-Service Plan?
A point-of-service (POS) is an organized health care plan that offers varieties of benefits to policyholders. A POS is health insurance that lowers medical costs for policyholders. This type of health plan combines the features of the Health Maintenance Organization (HMO) and the Preferred Provider Organization (PPO), this is why POS is regarded as a hybrid of HMO and PPO.
How Does a Point-of-Service Plan Work?
Basically, a point-of-service plan allows a policyholder to pay less when accessing medical care from providers who are in the plan's network. In a POS health plan, a policyholder is required to select an in-network doctor or physician as their primary care provider. This health plan also permits policyholders to designate a primary care doctor outside of the network, this is why a POS plan is considered a hybrid of HMO and PPO. Relating to the obligations and expenses incurred by the POS plan and the policyholder in this type of health insurance plan, it is important to know that policyholders pay more when they use in-network services, while the POS plan pays more when out-of-network services are used. In either of the services, however, the policyholder will make payments. A major advantage of a POS plan is that it offers a holistic coverage as policyholders who travel frequently are catered for regardless of their location.
The Relative Unpopularity of Point-of-Service Plans
Despite the benefits that the point-of-service plan offers, it remains unpopular. POS plan only holds a tiny share of the health insurance market as the majority of the people that seek health insurance plans go for either HMO or PPO plans, while in the actual sense, the POS plan is a hybrid of HMO and PPO plans. One major reason for the unpopularity of the POS plan in the market is the low awareness about it. This plan is not frequently advertised, unlike other plans. Aside from poor marketing, the costs of POS their many individuals into confusion as it is difficult to pinpoint what the prices are.
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