Before shopping for affordable health insurance, you should be aware of the different types of policies available. There are many different kinds of medical plans available, but most can be separated into three main categories; fee-for-service, managed care, and the third option combines health savings accounts with high-deductible plans.

1. Traditional fee-for-service

 Also known as indemnity plans, traditional fee-for-service (FFS) insurance offer plan participants maximum flexibility to manage their health care. With this type of health insurance, you have the freedom to select doctors and specialists independently without needing referrals or prior authorization.

FFS plans generally have more out-of-pocket costs and paperwork, and the premiums can also be more expensive that other health insurance options. Typically, you will have to meet a deductible before your insurer will begin paying claims for covered health care services. Once that deductible has been met, the health insurance company will reimburse you for a percentage of the cost. Frequently, plan participants are required to pay for the cost of care up front, and submit a claim for reimbursement.

2. Managed care

Managed care options include Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs) and Point of Service (POS) plans.

Although each operates differently, all work to reduce costs in a similar way. Most maintain a system of in-network providers who have agreed to charge set prices for certain health services. Depending on the plan that you choose, participants seeking care from out-of-network providers may have their claims denied or may be required to pay for a larger portion of their medical bills.

High-deductible plans and health savings accounts

Generally, high-deductible plans have the cheapest health insurance premiums available. These plans generally require policyholders to pay thousands of dollars of out-of-pocket costs (the deductible) before insurance coverage kicks in.

These medical plans are typically best for healthy adults who have few ongoing medical. A high-deductible plan can be combined with a health savings account (HSA), which allows individuals to pay for health care expenses on a tax-free basis. High-deductible plans are often the cheapest way to get health insurance protection for catastrophic illnesses or accidents.