Essentially there are two kinds of health insurance, Fee-for-Service and Managed Care. Both plans cover an array of medical, surgical and hospital expenses as well as prescription drugs.

Fee-for-Service
These plans generally assume that the medical professional will be paid a fee for each service provided to the patient. Patients are seen by a doctor of their choice and the claim is filed by either the medical provider or the patient.

Managed Care
Various plans work differently and can include: health maintenance organizations (HMOs), preferred provider organizations (PPOs) and point-of-service (POS) plans. These plans provide comprehensive health services to their members and offer financial incentives to patients who use the providers in the plan.