In a fully insured plan the employer pays premiums and the insurance carrier bears the claims risk. In a self-funded plan the employer pays claims directly (usually with stop-loss protection and a third-party administrator), taking on more risk in exchange for cash-flow control, claims data, and ERISA preemption of many state insurance mandates.
Plans & Coverage
How health plans work: plan types (HMO/PPO/EPO/POS), metal tiers, provider networks, prescriptions, claims and appeals, preventive care, and cost-sharing.
What’s the difference between a deductible, copay, coinsurance, and out-of-pocket maximum?
A deductible is what you pay before the plan starts paying; a copay is a flat fee for a specific service; coinsurance is your percentage share of a cost after the deductible; and the out-of-pocket maximum is the most you’ll pay in a year before the plan covers 100% of covered services.
What’s the difference between HMO, PPO, EPO, and POS plans?
These describe how a plan manages access to providers. An HMO requires a primary care physician and referrals and generally covers only in-network care; a PPO is the most flexible (no referrals, some out-of-network coverage); an EPO covers only in-network care but skips referrals; and a POS plan blends HMO and PPO features.
What are the ACA metal tiers (Bronze, Silver, Gold, Platinum)?
In the ACA-regulated individual and small-group markets, plans are grouped into metal tiers by “actuarial value”, the average share of covered costs the plan pays: Bronze ~60%, Silver ~70%, Gold ~80%, Platinum ~90%. A lower tier means lower premiums but higher cost-sharing when you use care.
In-network vs. out-of-network, and what is balance billing?
In-network providers have a contract with your plan and accept its negotiated rates; out-of-network providers don’t, so they cost more and can “balance bill” you for the difference between their charge and what your plan allows. In-network providers generally cannot balance bill.
What is the No Surprises Act and what does it protect me from?
The No Surprises Act (effective for plan years on or after January 1, 2022) protects you from many surprise out-of-network bills (emergency care, and out-of-network clinicians who treat you at an in-network facility) by limiting your cost to in-network amounts and routing the payment dispute to arbitration. It does not eliminate every out-of-network charge.
What is prior authorization, and how is it changing?
Prior authorization is when your plan must approve a service or drug before it will pay. It’s used to control cost and confirm medical necessity, but it can delay care. In 2025–2026 the rules are tightening: CMS added Medicare Advantage guardrails, about 60 insurers pledged to cut it, and Texas limits AI-only denials and “gold cards” reliable providers out of it.
What is an Explanation of Benefits (EOB), and how do I appeal a denied claim?
An Explanation of Benefits (EOB) is not a bill: it shows what your provider charged, what your plan allowed and paid, and what you may owe. If a claim or prior authorization is denied, you have the right to an internal appeal with the plan and then an independent external review.
How are GLP-1 drugs affecting health plan costs?
GLP-1 medications (such as semaglutide) are among the fastest-growing costs in health plans, an estimated ~14% of 2026 drug spend, often more than $1,000 a month before rebates. Employers are deciding whether to cover them for weight loss and, if so, how to manage utilization.
Where has telehealth settled after the pandemic?
After spiking during the pandemic, telehealth has settled at around 5% of medical claims, roughly 10–15 times its pre-pandemic level, with behavioral health now its largest use. Under the One Big Beautiful Bill, HDHPs can permanently cover telehealth before the deductible without breaking HSA eligibility.
What is a PBM (pharmacy benefit manager)?
A pharmacy benefit manager administers the drug side of a health plan, building the formulary, negotiating with drug manufacturers and pharmacies, and processing pharmacy claims. PBMs strongly influence which drugs are covered and at what cost, and their pricing has drawn scrutiny for being opaque.
What is a drug formulary, and what are tiers?
A formulary is the list of prescription drugs a plan covers, organized into tiers. Lower tiers (generics) cost you the least; higher tiers (preferred brand, non-preferred brand, and specialty) cost more. Placement reflects cost and clinical value, and formularies change over time.
What is step therapy (“fail first”)?
Step therapy requires you to try a lower-cost drug first and show it didn’t work (or isn’t appropriate) before the plan will cover a more expensive alternative. It’s a utilization-management tool, and your prescriber can request an exception when stepping through isn’t medically appropriate.
What is coordination of benefits when I have two health plans?
When you’re covered by two health plans, coordination-of-benefits (COB) rules decide which pays first (primary) and which pays second (secondary). The secondary plan doesn’t simply double your coverage; together the plans generally pay up to, not beyond, the allowed amount for a service.
What is mental health parity (MHPAEA)?
The Mental Health Parity and Addiction Equity Act requires group health plans that cover mental health and substance-use treatment to do so on terms no more restrictive than for medical and surgical care, including copays, visit limits, and prior-authorization rules.
What preventive care is covered at no cost?
Under the ACA, most health plans must cover a defined set of preventive services (such as recommended screenings, immunizations, and well visits) at no cost to you (no copay or deductible) when you use an in-network provider.