What is the Difference Between Health Insurance and Health Plan

Health insurance and a health plan are services that are similar in many ways, but with some differences. Both offer benefits to beneficiaries, as the goal is to protect them when they need it most.

Healthcare in Brazil is a right of all citizens and, therefore, a duty of the state. Furthermore, the Unified Health System (SUS) is considered one of the best public health systems in the world. Despite this, we encounter many difficulties and are not always able to access it in the best possible way.

This led to the creation of more efficient alternatives: insurance and health plans. However, many people still don't even know that health insurance exists, let alone the difference between it and health plans and which option is best.

Therefore, we're here to help clarify any doubts you may have about these healthcare services so you can confidently decide which one to choose.

What is a health plan?

 A health plan is when a private company offers a medical assistance service, with its own service network. Therefore, if you need any type of medical service, you must first consult the service network and select the professional, hospital, laboratory, or clinic offered by the provider.

Coverage and scope vary, and the best plan will depend on the profile and needs of the user and their dependents.

How do they work?

There are different types of inclusion, namely:

• Individual: this is the most expensive option, as it is customized for a single individual;
• Family: extends to the contractor's direct family members, which includes father, mother, spouse and children;
• Collective: hired by a group of people, normally in class associations, unions, etc.;
• Corporate: Designed for public and private companies looking to support their employees. It is debited directly from the employee's payroll, reducing bureaucracy.

They also differ according to the coverage margin, which can be:

• Reference: more expensive because they are the most complete, with broad coverage.
• Outpatient: very basic plan, with coverage for consultations and simpler procedures — restrictions depend on each provider's contract;
• Hospital: in addition to basic coverage, it also guarantees hospitalization without time limits;
• Hospital with obstetrics: in relation to the previous one, prenatal care, childbirth and newborn care are added;
• Dental plan: limited to dental procedures performed in a dental office, such as periodontics, radiological exams, endodontics and simpler oral surgeries, as well as emergencies and urgent cases.

What is health insurance?

Health insurance generally doesn't offer a comprehensive coverage network. Instead, the insured receives reimbursement for medical expenses related to consultations, exams, treatments, surgeries, etc.

This gives you greater freedom to choose professionals, hospitals, laboratories, and clinics. However, some health insurance companies are already working with accredited networks to offer quality professionals and hospitals without the need for reimbursement.

However, the reimbursement amount and limit are defined in the contract and, just like traditional insurance, the beneficiary pays a monthly amount, which varies according to the potential risks of future treatment costs.

What do health insurance and health plans have in common?

Because they share some similarities, people often use the two terms interchangeably. This is why there are so many questions surrounding this topic, and why people often get confused.

So much so that the National Supplementary Health Agency (ANS) establishes the same rules for these two types of services. Therefore, let's first understand what health insurance and a health plan have in common, and then discuss the differences.

Same goal

The main similarity between a health plan and health insurance is that they have the same objective:

Providing medical and hospital care in times of need, without requiring the patient to rely on the public health system—which, in many regions of the country, offers services that fall short of the expected quality standards.

Grace period

Another similarity concerns the waiting period. Although each contract defines the waiting period, both health insurance and health plans generally have a waiting period. In other words, there is a time limit for the beneficiary to have access to the contracted services, even if they are paying the monthly fees.

There are some modalities that waive the waiting period, but they usually cost more or are exclusive to corporate plans. Regardless of the service you choose (plan or insurance), you'll hear about and need to be aware of waiting periods.

Coverage

Both insurance and health plans cover appointments with general practitioners and specialist doctors, as well as hospitalizations, surgeries, and exams.

What is the difference between a health plan and health insurance?

As you can see, there are many similarities, but the scope of the insurance contract and health plan is quite different. Furthermore, the price varies significantly, which is a plus for health insurance, which is generally cheaper.

It's also important to remember that health insurance is a well-established service in the market, having been in operation for many years. Health insurance, on the other hand, is a newer offering that has been slowly gaining traction, but it's already winning the hearts of many.

Contract

The health plan offers a package of health-related services, but these services can only be used in certain situations. The membership contract specifies all of these services in detail, so you should read carefully before signing and be aware of your rights.

With health insurance, the patient can perform the services they want and request reimbursement.

Scope of assistance

As mentioned above, with your health plan, the professionals and establishments where you can request services must be affiliated with the provider. Therefore, if you choose a doctor outside the provider's network, you'll have to pay for the consultation, usually without reimbursement.

The names of participating professionals and establishments are available on the health plan's websites, apps, and periodicals. However, it's important to always stay up-to-date, as there's a high turnover rate among professionals. This means that if your long-time gynecologist decides not to renew with the provider, they won't see you unless you pay for the appointment.

In health insurance, the scope is much greater, since the beneficiary is not limited to the network of professionals, clinics, hospitals and laboratories imposed by the operator, even if it has such a network.

This means they can freely choose where to get their exams, which doctors to see, and which hospitals or clinics to go to. Simply request reimbursement, and the monthly fee isn't as high as you might think—in fact, it's often even cheaper.

Treatment

With a health plan, if the treatment you need is included in the contract, you won't have to pay anything beyond the monthly fee, unless it's a co-pay plan. However, if the treatment isn't covered by the contract, the beneficiary must bear all expenses.

Regarding health insurance, the patient typically chooses the service they want, pays for it, and is then reimbursed by the insurer. The amount to be paid by the insurer will vary according to the terms of the contract. This means that the insurer is not required to cover 100% of the costs, but only the contracted limit.

Which of the two is better: health insurance or health plan?

Each has its own advantages and disadvantages, so determining which is best for you requires considering these factors and your consumer profile. So, check out the advantages of each and see which one best fits your needs and circumstances.

Health plan advantages

• Security and peace of mind

Health plans guarantee quality care when you need it most and provide comprehensive coverage. In other words, if you need the service right now, simply search the company's guide available on the apps or website and find the professional or service closest to you.

• Portability

Let's say you need to move to a different region for work, and your plan doesn't work in that city. Don't worry, just request a port to another carrier that serves that region, and you won't have to go through the waiting period again.

Similarly, if you want to switch to another provider with better coverage, simply request portability. According to the ANS, this is only permitted if you present your current plan card and the last three paid bills, and have been with the plan for at least two years.

• Zero cost in service

Although slightly more expensive, health insurance doesn't require you to pay at the time of care; the cost of consultations, exams, treatments, and hospitalizations is already included in the monthly fee. With health insurance, you'll need to pay out-of-pocket for the costs and only then be reimbursed later.

Advantages of health insurance

• Security and peace of mind

Health insurance also offers its members security and peace of mind when they need medical services. You can request any medical assistance and then request reimbursement.

• Best cost-benefit ratio

Depending on your health conditions and age, health insurance can end up being expensive. Therefore, especially if you have group or business insurance, health insurance can end up being more cost-effective.

• Freedom of choice

Since there are no restrictions on the service network, the insured is free to choose the professionals and establishments they want, including those that might not be covered by the health plan.

Plus, you don't have to worry about employee turnover, as with a health plan, or worry about moving to another city. You don't have to go through the bureaucracy You can find another company that serves your new region to transfer your number. Simply seek service wherever you need it, and the fees will be refunded.

• Greater flexibility

Health plans generally have a more rigid model than health insurance. According to the rules established by the ANS, insurance policies can be comprised of various coverage modalities, allowing you to create a plan fully tailored to your clients' needs.

• Costs

Health insurance is typically cheaper than private health plans, but the insured must have emergency funds. This is because reimbursement only occurs after a period established by the contract. Therefore, in cases of medical emergencies or even routine appointments and exams, you'll need to have extra funds available to temporarily cover medical expenses.

• Practicality in contracts

Health plans often have numerous rules and contractual clauses that delay care. Although health insurance also has a waiting period, you can access services more quickly, except for procedures that require larger reimbursements.

So, if you're in good health and don't usually see a doctor often, health insurance may be the best option for you. After all, it'll cost less, and you'll still be reimbursed.

However, if your health is very poor and you undergo many checkups throughout the year, a health plan might be the best option. Although health insurance also offers accredited care networks with qualified professionals and facilities.

Regardless of which one you choose, the important thing is to stay safe. After all, we're all at risk of illness or accidents. Even if you follow a healthy lifestyle, you never know what might happen.

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