Health Insurance Basics

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 Health Insurance 

Many people exercise and eat right to maintain their health but don't think about their health insurance coverage until they need to use it.

Like preventive care itself, it's important to take action before a serious health problem arises. Make sure you understand your options and choose a health plan that is right for you.

There are two major types of health plans: managed care and fee-for-service.

  • Managed Care plans are agreements between certain doctors, hospitals and health care providers designed to offer a range of services to members at a reduced cost.
  • They go by many names, such as Health Maintenance Organization (HMO), Preferred Provider Organization (PPO), Individual Practice Association (IPA), or Point of Service (POS) plan.
  • You can learn more about the differences between these plans in our
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  • Fee-for-Service plans, also known as indemnity plans, allow you to choose health care providers yourself. This gives you a wide range of options that includes specialists, such as cardiologists and surgeons.

Your main concern, however, shouldn't be whether the health insurance plan you choose is managed care or fee-for-service. The characteristics of the plan are far more important.

When you compare the options offered by your employer or when purchasing your own coverage, you must consider the plan's features, overall quality and affordability.

Examine the plan's features

Whether you choose a fee-for-service plan or a managed care plan, make sure it covers the services you are likely to use.

For example, if you decide to change health plans, your prescriptions may no longer be covered. You may also need permission to see a specialist or use a doctor outside of your plan's network. Chronic health conditions and mental health treatment options may be significantly different depending upon your plan.

Make sure you thoroughly review everything your policy will cover - and not cover - before making a decision.

Evaluate the plan's overall quality

Independent government and nongovernment organizations rate many health insurance plans.

In addition, some managed care groups apply for accreditation, which rates companies on standards such as quality of care, doctors' credentials, members' rights and responsibilities, and preventive health services.

You can find out if performance measure information is available for your plan by asking your employer, calling your state's Department of Health, or asking \ your state insurance commissioner's office.

Estimate the plan's affordability

Several factors affect the affordability of your health care coverage. For example, the amount of your monthly premium may vary depending on the level of service you choose.

You also need to consider how high your deductibles will be (both per visit and annually) and whether your provider will pay for preventive care.

You can review your options and compare your current coverage to coverage available through the Wells Fargo health insurance shopping service.

Insurance products are available through Wells Fargo Insurance, Inc. (Minneapolis, Minnesota). Wells Fargo Insurance, Inc. is a licensed agency representing and compensated by the insurer based on the amount of insurance sold. Wells Fargo Insurance, Inc. is an affiliate of Wells Fargo Financial.

  • Insurance is:
  • Not a deposit of or guaranteed by the bank
  • Not insured by the FDIC or any federal government agency