The main difference with indemnity plans is the flexibility and freedom to select whom you see for health care without being penalized. Let’s take a closer look at what indemnity plans are, how they function, and if they are right for you.

Indemnity Plan Defined

With an indemnity plan, sometimes called “fee-for-service”, you can use your medical provider of choice (such as a doctor or hospital).  Either you or your provider can send the bill to the insurance company for payment as structured according to which plan you select.  This gives you the advantage to direct your own health care and visit almost any doctor or hospital you prefer. 

Different from those offered by health maintenance organizations (HMOs) and preferred provider organizations (PPOs),  an indemnity health policy grants you the advantage to obtain medical care where you choose instead of from a provider network, although some offer even greater savings if your preferred provider is within the indemnity plan’s network. HMOs, IPAs, and PPOs use ‘managed care’ and may force you to choose a primary care provider as part of their plan, leaving you to choose a new provider if yours is not within their network. 

This may be the plan for you if you prefer flexibility of providers.