June 1, 2004
Q: I am starting my own firm. My biggest struggle in making the move is getting health insurance. I still need coverage. Any suggestions?
— V. Callahan. Via the Internet
A:You’ll have to choose between a health maintenance organization (HMO), preferred provider organization (PPO), or point-of-service plan (POS).
HMOs are generally the least expensive group health option and also the least flexible. In exchange for a monthly premium, you are entitled to doctor visits, preventive care, and medical treatment, all for an additional co-pay of $5 to $10 for each appointment. You cannot visit a doctor who’s outside the HMO network. An HMO covers prescription drugs.
PPOs offer more flexibility but come with a slightly higher premium. They allow you to venture out of network at your discretion and do not require a referral from a primary care physician.
POS plans are almost a hybrid of HMO and PPO plans. You designate an in-network physician to be your primary care provider. While a POS plan lets you go out of network, you’ll have to pay most of the cost, unless your primary care physician refers you to an out-of-network doctor.
With that said, your first step is to contact an insurance broker who specifically handles small businesses to find out which plan is best for you. To get an estimate, you can contact your local broker, or get an online quote. One good site is NetQuote (www.netquote.com), a free consumer service that will provide several competing quotes from different companies.