On the other hand, HMOs have more of a reputation than fee-for-service plans
for attempting to put limits on the care you may receive through various administrative processes and medical review.
Private fee-for-service plans
must demonstrate that the plan includes a sufficient number and range of providers willing to furnish services.
These employees selected traditional fee-for-service plans
more often than Ppo's and HMO's for nearly every combination of plan types offered.
Prior research has shown that some prepaid forms of health care financing incur lower utilization/expenditures than fee-for-service plans
for outpatient mental health care (Diehr, Williams, and Martin 1984; Wells, Manning, and Benjamin 1986; Norquist and Wells 1991).
Other fee-for-service plans
require a copayment, usually between 10 and 20 percent of the cost.
have adopted some activities used by HMOs and PPOs to control the use of medical services.
Together, they account for about 90% of enrollment in private fee-for-service plans
, according to the CMS.
But they can all be categorized into four basic groups: traditional indemnity or fee-for-service plans
, preferred provider organizations (PPO), point-of-service plans (POS) or health maintenance organizations (HMO).
Finally, for fee-for-service plans
, the alliances will set a fee schedule for physicians and for hospitals.
Thus, HMOs have a 50% lower rate of hospital stays than fee-for-service plans
Over 1 million older Americans are now enrolled in private fee-for-service plans
, about 2% of all Medicare beneficiaries.
PPO's, a type of fee-for-service plan
, allow employees to choose their providers, but give a greater reimbursement if selected providers are used.