Indemnity health plans are commonly referred to as what type of plans?

Indemnity health plans are commonly referred to as fee-for-service plans. In a fee-for-service arrangement, insured individuals have the freedom to choose any healthcare provider they wish. The plan pays a specific amount for each service rendered, and patients are responsible for paying the difference, which allows for flexibility in selecting doctors and facilities.

With fee-for-service plans, members are not restricted by networks, meaning they can see specialists or out-of-network providers without needing a referral, which is a hallmark of managed care plans. This model emphasizes the traditional approach to healthcare, where providers are compensated based on the volume of services offered, rather than a fixed cost or a capitated rate.

Managed care plans, HMOs, and PPOs, on the other hand, often involve some level of network restrictions or require referrals, which is not characteristic of indemnity plans. This distinction is crucial for understanding how payment structures and patient provider relationships differ in various health insurance models.