Point-of-service, or POS, health insurance is one of a few common group coverage options, along with health maintenance organization and preferred provider organization plans. POS requires referrals for specialist treatment like HMOs, but they have broader networks and some out-of-network benefits like those provided by PPOs.
POS Insurance Basics
The label "point-of-service" refers to the fact that you have health benefits that apply to both in-network and out-of-network coverage. Like the other major group policy formats, POS is a network-based structure, which means that your benefits are optimized when you visit a doctor or facility within the policy's provider network. The network with a typical POS plan is broader than with most HMOs. Covered members in a POS plan make co-payments on preventative and treatment-based health care, and the insurance company covers the rest of the claim as outlined in the group benefits policy.
POS plans tend to offer better out-of-network benefits than HMOs and many PPO policies. If you visit an out-of-network provider without coverage, it could cost you a significant amount of money. When you are on vacation or want to see an expert in another state for specialized treatment, strong out-of-network benefits come in handy. The co-payments and co-insurances for out-of-network care are often much higher than what you pay in-network, but the flexibility offsets the cost increase for some covered members.
POS and HMO plans require a referral to see a specialist, whereas PPO policies don't. With a POS, all members identify a primary care physician upfront, and women select an OB/GYN for women's health maintenance. The point of the referral requirement is to encourage people to focus on preventative health care, and to minimize unnecessary and often expensive specialist services. To see a specialist, you typically have to get a referral form filled out and signed by your PCP. This requirement is cumbersome and time-consuming in some situations, but it may contribute to lower-cost premiums and out-of-pocket expenses on your policy.
Additional POS Details
Some insurance companies offer national POS plans. National policies may waive the referral requirement for both in-network and out-of-network coverage because of the broad geographic reach. Paperwork requirements are often higher for out-of-network services. Also, POS policies have higher deductibles than other group plan structures in many cases. People who pay significant premiums and then have a moderate or high deductible on top of that may not get strong value from a POS setup.