POS | Point of Service

A Point of Service plan is a hybrid of an HMO and PPO. This plan allows you to pursue care through any healthcare provider you wish, but your benefit level varies depending on whether the provider is inside or outside of your network.

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Eric Stauffer is a former insurance agent and banker turned consumer advocate. His priority is to help educate individuals and families about the different types of insurance they need, and assist them in finding the best place to get it.

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insuranc...

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Reviewed by Leslie Kasperowicz
Farmers CSR for 4 Years

UPDATED: May 13, 2021

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A POS, or “point of service,” plan is a hybrid of a Health Maintenance Organization (HMO_ and Preferred Provider Organization (PPO) plan. How do POS plans work? What is the difference between POS and PPO? Under this type of plan, you are free to pursue care through any healthcare provider you wish, but the benefit level you receive will vary depending on whether that provider is a network provider or outside of your network.  POS plans are growing in popularity among individual consumers and through employers. Their flexibility makes them attractive, and they can be quite affordable.

In general, a POS health insurance plan will cost a little less than a PPO policy with the same level of benefits.  The POS plan will likely be somewhat more expensive than an HMO, but the flexibility provided by the POS will make it the more attractive option for many consumers, especially in areas where accessing in-network care is typically difficult.

How does Point of Service work?

Like an HMO, a point of service plan requires you to designate a primary care physician, or PCP.  This physician will be your primary contact when receiving any medical care, and they will be responsible for providing you with any specialist referrals. Unlike an HMO, however, you may still receive care from a doctor who is not your primary care provider and you can be referred to an out-of-network specialist when necessary. Your insurance will provide coverage for this care, but the benefits level will be lower than if you had stayed within your network.

In general, care given by the PCP is not subject to a healthcare deductible.  Preventative care is usually fully covered by the plan as well.  Outside of these expenses, you will typically need to pay a co-payment and co-insurance up to the agreed-upon annual out-of-pocket maximum.  There will also be an annual deductible associated with the policy.

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What are the pros and cons of POS plans?

In some ways, a point of service plan offers the “best of both worlds” between HMOs and PPOs. With this type of coverage, you get the flexibility to pursue care from any provider you wish, but you can also enjoy the benefits of having a primary care physician. If you don’t mind doing all your care coordination through your PCP, this type of policy can be an excellent choice for a health plan. It’s also a good option if your existing primary care doctor is already part of the POS provider network.

The down side of a POS plan is that you will usually have higher out-of-pocket expenses for your health care service than you would through an HMO. Your premiums may also be higher. As with all other insurance types, you will not receive the same level of benefits from a doctor outside of your network, but the freedom to pursue a non-network provider is still something many patients find very valuable. If having your choice of provider is more important than the cost of care, then you may find that this health plan is right for you.

Depending on your needs and budget, a POS might be the right choice for you. It’s important to do your research and find a health insurance company with a network of providers that includes the health care providers you want to use. It’s also a good idea to compare costs and find the right balance between monthly premiums and annual out-of-pocket limits when looking for an insurance provider. Many people with POS plans find that a health savings account is a good way to cover the cost of any out-of-pocket medical expense with these types of plan, so this may be something worth investigating when purchasing your own POS plan.

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