There are many different types of health plans in this world. One of them is called an Indemnity plan. The plan covers medically necessary medical costs, the insurer will also pay a premium and a deductible. After the premium and the deductible is paid then the patient will pay a coinsurance which is usually a 80-20 percent ratio. The insurance will pay 80% then the rest will need to be cover by the patient. The next plan is called a managed care it uses a method called fee-for-service it has a lower deductibles and premiums, but has a smaller provider network. What happens is the patient will see the provider pay for the services rendered then the provider files a claim with the third party (insurance company) then the insurance will reimburse the the provider and patient, while the patient is paying a premium to the third party to cover their costs. There are several different plans that are offered and use the managed care philosophy. The health maintenance organization (HMO) an HMO offers the capitation to the providers which is a fixed prepaid payment agreement between both provider and third party that is based upon how many patients with the provider. This system works by the patient receiving services from the provider and the patient paying the third party a set premium, while the third party insurance pays the capitation fee to the provider. Point-of-service plans are called an open HMO because it allows more providers in their network but with additional fee's and costs for the patient. Preferred provider organization (PPO) is also like an HMO that has a network of providers but they negotiate lower discounted prices for the PPO. There are usually premiums and copay’s in an PPO and are usually a higher price. A copay is payment that needs to be paid to the provider at time of services rendered. A consumer driven health plan this is a