Health Insurance - An Unaccounted-for Workforce Cost

HMO Plan

HMOs, on the other hand, do not allow an option to see any providers except those who participate in the HMO plan. The philosophy of the HMO is that a primary care physician should orchestrate the medical services provided to an insured person. This can reduce the expense of employees going directly to specialists for care that can be provided by a physician whose rates are lower. Also, there is more of a preventive care approach taken by HMOs - wellness care is routinely offered in these kinds of plans.

Employees still may be required to cover co-pay fees for office visits and prescriptions, in order to reduce the frivolous use of medical services, but there is no obligation beyond that - in other words, employees do not pay an additional percentage of the medical provider's fees. This savings to employees has made HMOs more popular than the PPO among Dungarvin's staff.

An additional bonus has been the fact that Dean's plans are community-rated, meaning that all Dungarvin employees are included in a larger pool of insured persons. Thus, if our experience (claims history) is higher than other groups, we don't pay more in premiums as a result; rather, we pay an average of the experience of our group, plus the experience of the group as a whole. This has helped to keep premium costs lower. (Single HMO and Family HMO graphs)

On To Barriers to Family Coverage