Still confused about the right healthcare plan for you and your family? Is it HMO or PPO? While you were juggling between both the plans, there are multiple factors that need to be considered. In this article, we will check which plan is right for you and why many individuals choose PPO plans over HMO plans.
Comparing HMO and PPO plans will help you to make an informed decision to choose what works best for you.
What is meant by HMO?
The full form of HMO is Health Maintenance Organization. It is a health insurance plan that requires every person enrolled in the plan to choose a primary care doctor. The selected primary care doctor is responsible for referring the patient to in-network specialists according to requirements. Each HMO plan covers few health specialists who agree to provide medical services at the best rates based on discussions with insurance providers.
Usually, the benefits of HMO plans are location-based. Some of the key benefits of HMO plans are;
- Low monthly premiums
- Affordable out-of-pocket fees
- Low consultation charges
- Complete care of your health by your primary physician
- Easy settlement of claims.
However, the major drawback of these plans is they require you to stay within the network for complete medical care until it’s an emergency-based case. Adding on, if your trusted doctor is not a part of the HMO network then you need to choose another in-network doctor.
Why choose the PPO plan?
PPO is an abbreviation for Preferred Provider Organization. It is a type of medical insurance plan that allows its participants to seek medical care from any doctor in or out of the network. However, you need to pay slightly high charges to doctors that are out of network. If your doctor agrees to charge the medical services according to PPO rates, still, the PPO plans will make you pay an extra amount. This is because the doctor is not a part of the plan. However, the best part is, participants, do not require any referral to consult with a specialist of the hospital of their choice. Also, the PPO plan offers more flexibility by allowing its participants to choose when and from which hospital they want to seek medical services.
Let’s better understand the PPO plan with an example:
Mr. John has recently enrolled in a PPO plan. He goes regularly to see a physician for monthly physical checkups. Last week, his knee was hurting so he consulted with a doctor who is in-network. He paid his co-payment and some costs of X-rays etc. He also consults with out-of-network doctors and pays them completely. Finally, all his claims have been settled easily as he is under the PPO plan.
Why choose the PPO plan over the HMO plan?
Choosing HMO or PPO is subject to the personal preference of participants. However, individuals choose PPO plans over HMO because of the flexibility and freedom to choose any medical specialist. Even the statistics show that more people were involved in PPO plans than HMO plans.
In simple words, HMO plans are meant to provide medically necessary services at very low premiums and PPO plans are designed to provide a great selection of medical specialists. In PPO, participants need to pay high monthly premiums but they can consult with specialists frequently with few restrictions on out-of-network doctors. Also, in PPO plans, you might have to pay slightly high deductibles compared to HMO. However, the former provides greater access to healthcare specialists and more flexibility with which doctor you want to see. This eventually fills the gap.
In a nutshell, the main difference between HMO and PPO plans depends upon premiums, access to specialists, healthcare coverage, and the size of the plan. If an individual is in good health with no special medical needs then an HMO plan is right for them. However, if they have ongoing medical needs and need more flexibility in switching between doctors, PPO makes the right choice.
I hope this helped you choose the right plan for you and now you are aware as to why more people are enrolling in PPO plans than HMO. To know more do check our other blogs and don’t forget to leave your views in the comment section.
Referencethan:
- https://www.ramseysolutions.com/insurance/hmo-vs-ppo
- https://individual.carefirst.com/individuals-families/health-insurance-basics/understanding-your-coverage/hmo-vs-ppo.page?
- https://www.hindustantimes.com/education/competitive-exams/upsc-annual-exam-calendar-2022-released-at-upsc-gov-in-cse-prelims-on-june-5-101628967949330.html
- https://www.bcbsm.com/index/health-insurance-help/faqs/topics/how-health-insurance-works/difference-hmo-ppo.html
- https://theolsongroup.com/hmo-vs-ppo/
- https://thrive.kaiserpermanente.org/thrive-together/health-care-101/hmo-vs-ppo-advantages
- https://corporatefinanceinstitute.com/resources/knowledge/other/hmo-vs-ppo/
