What is Point of Service?

Point of service is a type of managed care health insurance plan that offers members of the plan reimbursement for medical expenses. In such a plan, members must choose a primary care physician from within a network of providers, and any specialists must be referred by this physician. A point of service plan, or POS plan, offers relatively low co-payments and no deductibles to members as long as they stay within the network of the POS. If a member goes outside the network to see a specialist or doctor, then he or she will be responsible for a deductible payment and will get much less coverage from the POS plan.

When choosing a health insurance plan, consumers must often decide whether they wish to pay for the luxury of choosing from the best possible care or whether they wish to keep insurance costs down. This balancing act might be the reason that someone would choose to enroll in a point of service plan. A POS plan combines the cost effectiveness of a health maintenance organization, or HMO, with some of the flexibility of a preferred provider organization, or PPO.

An individual who chooses a point of service plan is required to go to a primary care physician, or PCP, as the first outlet for all medical problems. This physician becomes the member's point of service, and all medical situations of the patient go through this doctor. Any visits to this physician are covered by the POS plan and require very little co-payment, which is the payment that is joined with the insurer's coverage to cover medical costs. There is also no deductible, which is a payment that the patient must make before coverage begins, for visits of this type under a POS plan.

Should someone who has a point of service plan require care outside of what the primary care physician can offer, the PCP can then refer the patient to another doctor or specialist. If this physician is within the managed care network of the POS plan, the patient will covered in the same manner as with the PCP. Any specialist outside the network will require a deductible payment by the patient. In addition, any visit to or services provided by a specialist not referred by the PCP will not be covered by the POS.

The benefit of the POS plan is that it allows for a little more flexibility than a HMO while offering comparable cost control. A patient that requires significant care outside of what a primary care physician can offer might not be the best candidate for a POS. In such cases, a PPO, which requires higher co-payments and deductible payments, might be preferable, since it doesn't limit the options of the patient to within a predetermined network of physicians.