HMO vs PPO: Which Plan is Right for You?
This article compares HMO vs PPO to help you determine which Medicare Advantage Plan is right for you. Differences between Health Maintenance Organization (HMO) and Preferred Provider Organization (PPO) include referrals, coverage, cost, and network size.
Differences between HMO and PPO
The chart above shows you the benefit and cost differences between HMO vs PPO. The green values are positive, and the red values are negative. For example, HMO plans have lower deductible and premium costs (green). However, PPO plans have a higher deductible and premium costs (red). The first significant difference between HMO and PPO is referrals.
A PPO (Preferred Provider Organization) plan does not require referrals. However, HMO (Health Maintenance Organization) often require referrals. For example, HMO plans require referrals from your primary care physician (PCP) to see a specialist or have a special test done.
However, Medicare.gov says certain services such as annual mammogram screenings do not require a referral.
A second important difference between PPO and HMO is coverage. With a PPO you can see a doctor outside your network, but it may cost you more. However, an HMO does not provide coverage outside your network.
Thus, you pay all health care costs for out-of-network services with an HMO unless you have an HMO-POS (Point of Service) plan. Moreover, you can get out-of-network HMO coverage for emergency or urgent care.
PPO plans have better coverage and cost more than HMO plans. Some HMO plans may have $0 premium, and HMO-POS plans have a separate deductible. Thus, you pay one deductible for in-network and second deductibles for out-of-network with an HMO-POS plan.
Furthermore, Medicare.gov states an HMO-POS plan will “allow you to get some services out-of-network for a higher copayment or coinsurance.” Senior Healthcare Direct can help you find the most cost-effective HMO and PPO plans. Find plans that include your doctors and medications with our Medicare Advantage Plan Finder.
HMOs have the smallest network of doctors and hospitals. Thus, your choice of medical providers and facilities are more limited with an HMO. On the other hand, PPO plans have larger networks than HMO.
For example, an HMO network may include a county or part of a county, whereas a PPO network may serve a state or multi-state area.