You Decide Cooper Pearson Sports Marketing

July 22, 2013

You Decide Activity

FROM: Mabel Alberto

TO: Cooper Pearson Sports Marketing

Cooper-Pearson Marketing is researching various insurance plans in order to recruit and retrain the best employees. I will discuss some things that Cooper-Pearson should consider when selecting an insurance program. One benefit I suggest is offering prescription drug coverage. This can give the company a competitive advantage. From the employee’s point of view, this benefit is a great relief and makes life more simple because many are struggling to get prescriptions paid and are being forced to cut back on other necessary expenses to pay for prescription. I will also discuss HMOs, PPOs, and indemnity insurance plans.

In a health maintenance organization (HMO), the patient selects a primary care physician (PCP) who is responsible for managing the patient’s care. PCPs include internal medicine physicians, and in some HMOs, pediatricians, and gynecologists who provide basic healthcare for women. When a patient needs care from a specialist is the network or a diagnostic service such as a lab test or x-ray, the PCP is required to give a referral. If the patient chooses to go to a doctor outside of the HMO’s network, he must pay all or most for that care. In contrast, a preferred provider organization (PPO) is a health plan that has contracts with a network of “preferred providers” from which the patient can choose. The patient does not need to select a PCP, and no referrals are required to see other providers in the network. If the patient receives care from a doctor in the preferred network he will only be responsible for the annual deductible and a co-payment for the visit. HMOs offer the lowest cost care, but the trade-off is that access to care is very limited.

Another difference between HMOs and PPOs is that in an HMO, all of the providers in the HMO network are required to file a claim to get paid. The enrollee does not have to file a claim, and the...