What is an indemnity plan characterized by?

An indemnity plan is characterized by free choice of healthcare providers and percentage-based reimbursements. This type of health insurance allows the insured to seek care from any licensed provider without being restricted to a network. Once a patient receives treatment, they typically pay the healthcare provider upfront and then submit a claim to the insurance company to receive reimbursement for a pre-determined percentage of the costs. This flexibility in choosing providers is a fundamental feature of indemnity plans, making them distinct from managed care plans that often require network participation and limit provider choice.

In contrast to indemnity plans, options involving set monthly payments or mandatory network participation do not accurately represent the unique characteristics of indemnity plans. Indemnity structures focus on reimbursement after services are rendered rather than predefined payments or constrained networks.