PPO Versus Indemnity Insurance - Is There A Right Choice?

Dental Health
By: Spirit Dental
June 21, 2015

Two girls smiling while doing research on a laptop

There is a reason why people can match-up PPO versus indemnity insurance, because both policies have their degree of benefits. However, there is a "right" choice so-to-speak. Not everybody has the same financial situations and in many cases the choice is purely based on what plan suites the needs of the individual. The only way to make that right choice is by understanding both PPO and indemnity policies.

Indemnity Insurance

It is also referred to as a fee-for-service and the purpose of this policy is to cover a portion of medical bills related to injury or illness. Take note that there are several different plans in this sector so it's important to shop around, but for the most part these types of policies cover about 80%. The rest has to be covered by the individual.

The policy can only go into effect when the individual pays the annual deductible fee. How much this fee will be depends on several things, such as age and the condition of an individual’s health. Also pay attention whether a policy covers routine exams, because they usually don't.

The biggest benefit of the policy is that the individual is free to go to any dentist, doctor or hospital. An individual can also switch doctors at any time. Even though indemnity policies are typically more expensive, they come with more flexibility and freedom of choice.  

PPO Insurance

This type of insurance policy comes with a few more complications, but it's more affordable. Individuals have to pay a monthly premium which saves more out of pocket expenses. However, there are requirements in order to benefit from the plan.

The company selling the insurance is connected with several medical service providers. These include pharmaceuticals and doctors. Individuals have to go to the doctors and use medication brands that fall into the network of the insurance company, otherwise out of pocket expenses come into play. The doctors also become the gatekeepers for covered visits to specialists and pre-authorization needs to be given before the doctor visit can be made.

The most obvious benefit is that an individual gets to save a lot of money in terms of out of pocket expenses, as long as the rules of the policy are adhered to of course. Note that individuals are allowed to claim even when they visit doctors outside of the network, but this will result in a deductible payment from the individual.   

The Best Choice

Don't be too hasty when making a decision. Yes, it's important to have insurance, but it's also important to sustain it. For this reason it's recommended to look at all the aspects of a lifestyle. Is there a need for a family plan? Are you sure you will be able to afford the insurance in the long run?

Once you can establish exactly what you need and what you can afford then you will make the right choice. Just check all the details thoroughly and do your homework first.

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