HMO vs. PPO: What’s the difference and what to consider about your care
With Medicare annual enrollment around the corner, you may be seeing HMO options available in your area. Among plan options, there is a lot to consider when it comes to quality of care, cost and access to the healthcare providers you need to see.
Two of the most common types of healthcare plans are Health Maintenance Organizations (HMOs) and Preferred Provider Organizations (PPOs). There are significant differences between them, particularly in how they coordinate care through a primary care provider (PCP).
What is a Health Maintenance Organization (HMO) plan?
HMO stands for “health maintenance organization,” and champions a focus on proactive, preventive care to help members stay healthy. Members choose a PCP as their healthcare “quarterback” to help guide care and connect them to the right services and specialists for their needs – ultimately helping to make managing health and costs easier.
HMO plans typically have lower costs than other plan types when members use doctors and facilities in the plan’s network – which could mean more value and fewer surprises.
Why is a Primary Care Provider (PCP) so valuable?
HMO plans tend to be better suited for those who want PCP-guided, coordinated care within a network of trusted providers. PCPs tailor care decisions based on your unique care needs and can guide you through the health system to care services and specialists, as needed. Primary care coordination can support overall wellness and timelier, safer and more effective care.1 This includes supporting chronic disease and medication management as well as behavioral health needs and nutrition.
Supported by the structure of an HMO plan, your PCP can more easily see the whole picture of your care, allowing them to provide more personalized and consistent care.
What is a Preferred Provider Organization (PPO) plan?
PPO stands for “preferred provider organization.” PPO plans have a network of contracted providers, but they also offer coverage for out-of-network care. These plans typically allow members to book appointments directly with specialists without a referral, which may make them a better fit for people who know which specialists they want to see and are comfortable paying more for that flexibility.
While PPOs may allow members to see providers outside the plan’s network, members usually pay more for those services than they would for the same care from a network provider. Overall, PPOs generally come with higher out-of-pocket costs, but offer added flexibility.
Choosing between an HMO and a PPO plan can impact your healthcare experience, your access to providers and your wallet. Visit Medicare Made Clear® for information on different types of Medicare plans and other Medicare topics.
Share
