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Indemnity Health Plans

An Indemnity Health Plan, also known as a Fee-For-Service Health Plan, offers you the most choice of any health plan – but at a price.

With an Indemnity Health Plan there are no in-plan doctors or specialists or hospitals. With an Indemnity Health Plan you choose your own doctor or specialist or hospital with no regard for whether they are in-plan or not. Many people appreciate the unlimited choices that an Indemnity Health Plan makes possible.

The trade-off is cost. With an HMP or a PPO or a POS health plan there are doctors, specialists and hospitals which have agreed to reduce prices in order to be part of the plan. That’s not the case with an Indemnity Health Plan.

While details may vary from plan to plan, in most cases if you have Indemnity insurance you choose your own health care professional and you pay the bill for services out of your own pocket. Then, assuming you have met your deductible, your insurance will reimburse you for a portion of the bill you paid. Often plans will pay 80 percent, although this amount may vary depending on the plan you choose and the premium you choose.

With a fee-for-service plan you’ll be responsible for paying monthly premiums and there will be a deductible before any medical fees are paid by insurance. Even after you have met your deductible there will still be a per-visit co-payment or coinsurance payment for each doctor visit.

Also, with many Indemnity plans preventative health care check-ups are not covered and do not count toward your deductible.

There are three major types of Indemnity Health Plans. There are Basic, Comprehensive and Major Medical.

Basic coverage covers hospital room and board and basic care, plus x-rays and most medications prescribed in the hospital. Basic care also covers surgery, both in-patient and out-patient surgery, and your Basic policy will cover many doctor visits.

Major Medical generally only covers long-term care for illness or injury and will cover both in-patient and out-patient expenses.

Comprehensive Care generally combines both the Basic and the Major Medical coverage.

While Indemnity Insurance offers a wide range of choice, the cost of premiums, plus the fact that most policies exclude coverage for preventative health care often makes Indemnity coverage impractical or too expensive for families with children. Before signing up for an Indemnity plan it is important that you consider your options and, if possible, talk with someone knowledgeable about health insurance, one who can help you better understand your choices.


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