This is one problem which has now been recognized by the insurance companies and today there is an alternative in the form of a Preferred Provider Organization (PPO) plan which goes some way towards merging the two and providing the benefits of both.

The choice up until now has been between an indemnity plan which essentially provides cover for accidents and unexpected illness, and which also gives the policyholder considerable freedom in choosing where and when treatment is taken, and managed care which focuses on providing everyday medical care, but restricts the policyholder to seeking care within an approved network of healthcare facilities.

In essence the new PPO is a managed care plan and provides relatively low cost care in exchange for policyholders seeking care from within the insurance company's approved network of providers. However, a PPO also allows policyholders to seek treatment outside of the approved network if they wish to do so, within certain limits.

Unlike a traditional managed care plan, the PPO does not assign a patient to a primary care physician through whom all treatment must be taken and from whom a referral is required for specialist care. This means that the policyholder is free to consult any doctor within the network and can also seek treatment from a specialist outside the network if he or she chooses to do so.

There is a course a price to be paid for the ability to seek treatment outside of the insurance company's network and policyholders will normally need to pay a proportion of their costs when such treatment is taken.

This meets the needs of many people who want the freedom of choice offered by indemnity insurance and also meets the needs of those people who are looking for a low cost plan to cover their routine day-to-day medical needs.