Fee for Service Plan: Restrictions
Freedom can be costly, especially when it comes to choosing a fee for service health insurance plan. Fee for service plans are also referred to as “traditional health insurance.” Policyholders of this type of health insurance can choose any doctor, hospital, surgeon or health practitioner of their liking. There are no restrictions associated with a fee for service health plan. Many other types of policies require individuals to choose a primary care physician to get referrals of any kind, but that is not the case with a fee for service health insurance plan.
The only restriction associated with a fee for service health insurance plan is that for the flexibility, the premiums associated with the plan are extremely costly. But for that additional expense you can choose to seek out any type of medical attention. It is important to note that with this type of policy, not only are the premiums higher, but all the other costs associated with a fee for service plan may be cost-restrictive to some.
With a fee for service plan, a member is responsible for paying their care providers out-of-pocket when visiting the doctor. Then the member must complete the proper paperwork to submit a claim, and then a deductible amount (that could be in the thousands) must be met. Once that is met, the benefit kicks in and the cost of the medical care will be shared between the insurance provider and the policyholder in a coinsurance agreement.
All the restrictions associated with fee for service health insurance plans are associated with the overall cost for these types of policies. If you are interested in a fee for service plan despite the cost restrictions, it is advisable to open a medical savings account in order to get some tax relief and have the extra money put aside so you can take advantage of this type of traditional health insurance.