Thursday, December 4, 2014

HMO vs PPO...do you know the difference?

Here we go with the acronyms again...HMO vs PPO...let me break it down for you. It may be a short abbreviation but the differences are big. When choosing a plan through the Health Insurance Exchange, you'll find that HMO's could be a little cheaper and when you choose an on exchange plan, the choices will be HMO's, so it's important if you are shopping for insurance to know the difference.

A PPO, (Preferred Provider Organization) and an HMO, (Health Maintenance Organization) both use a network of physicians and hospitals to give you the highest quality of care. However, the main difference is how you use those networks.

In a HMO, you go through your main primary care physician for all other types of services. So you need to choose a PCP that is in your network and you will get referrals for other providers through your chosen PCP. In the case of an emergency you would not need a referral. Ideally, this is to help lower health care costs. So with a HMO you are not necessarily limited to care, you just need to get a referral first. Typically, doctors outside of your network are not covered at all.

With a PPO, you will have more flexibility. No referrals and you can see any doctors you choose, selecting from a larger list of in network providers. Even if you choose to go out of network, there are out of network benefits. You won't get the benefits of contracted rates but you are free to see out of network providers. Just be careful of balance billing by out of network providers.

So in summary, you'll have more flexibility, out of network benefits and a larger network with PPO's but could possibly have cheaper premiums with HMO's. HMO's help streamline care with the referral to trusted physicians from your own trusted physician.



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