When you are in the market for health insurance, you will come across two popular terms: PPO and HMO. Health Maintenance Organization(HMO) and Preferred Provider Organization(PPO). These are two of the most popular types of major medical health insurance plans.
These plans offer different kinds of coverage, including network size, costs, and out-of-network coverage. You will want to make sure that whichever plan you choose will meet your health needs, and allow you to see your current doctor–all within your budget. Choosing one doesn’t have to be complicated, as long as you know the differences.
Health Maintenance Organization
An HMO plan is based on a network of hospitals, doctors, and specialists that agree to provide care within a network for a reduced rate for their services. In order to keep costs low, you will have to have a primary care physician (PCP) within the network, who can refer you to specialists when needed.
An HMO plan will only pay for services within the HMO network, except for emergency care. Emergency care will be covered out-of-network in certain instances. Luckily, HMO plans are generally less expensive than PPO plans, with lower monthly premiums. You will not have to file as many claims with an HMO because most medical care you receive is typically in-network.
The downside to HMO plans is that if your current doctor is not within the network, you will have to choose a new doctor. If you need to see a specialist, you may need a referral from your PCP in order to be covered when you see the specialist. Also, you will need to stay within your network for care, unless it is an emergency.
Preferred Provider Organization
When it comes to PPO plans, you get more flexibility when picking your doctor and hospital. The care provided from these plans is more affordable if you stay in-network. Unlike HMOs, you are not limited to the providers who are in-network. You can see providers who are out-of-network, but it will cost you higher than in-network providers.
PPO plans are more expensive mostly due to their high monthly premium payments. However, the increased flexibility more than makes up for the higher prices. You do not need to maintain a PCP, and can see any doctor, including specialists any time without a referral.
The downside to PPO’s is the higher monthly premiums, and the fact that you will be responsible for managing and coordinating your own care without a PCP. If you want to visit a specialist, you will have to do the research on the ones available and around. Usually, a doctor will eliminate all of that by referring you to the one they associate with and who’s in-network.The Differences
When choosing between these two types of plans, you should consider these differences:
Plan Networks– PPOs have a broader network than HMOs. There are more doctors and hospitals included in PPO plans, giving you more choice.
PCP- Primary care physicians are required by HMOs, but not necessarily for PPOs. You will have to see your PCP first with an HMO if you want to see a specialist. The PCP must refer you to the specialist, lab work, etc. PPOs do not require a PCP, and you can see a specialist without a referral, and have the costs covered.
Costs- Because PPOs have a broader network of doctors and providers, you will pay more a month for this plan. HMOs are cheaper a month.
Out-Of-Network Care- PPOs differ from HMOs greatly in this aspect. HMOs will not cover any services rendered out-of-network. PPOs will provide some coverage for these services.
Which To Choose
When you are considering these two plans, it is best to note how much you want to pay, how much coverage you want, and whether you would want to see your PCP less, or see specialists without a referral.
If you travel a lot, then you might need to see a doctor once or twice while outside of your network, especially if you have a chronic condition. PPOs are best to provide coverage for your needs. If you want to save money, then HMOs are your best option.
If you need help differentiating the two different plans, and figuring out which one best suits your needs and budget, EZ.Insure can help. We offer you a personalized licensed agent within your area that will go over all the plans within your area. They will provide you with quotes on all the plans, what they cover, and sign you up, for free. Our services are completely free! To get instant quotes, simply enter your zip code in the bar above, or contact an agent by calling 888-350-1890, or emailing replies@ez.insure.
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