What is the Difference Between HMO and PPO?

One of the popular HMO health maintenance organizations and the PPO preferred provider organization are the two usual health insurance plans in the US. Though they have one common aim, there are still differences. 

In HMO systems, patients must select a regular family doctor (PF) out of the providers of healthcare services that are in a network. 

Here, the PCP serves as the zoom of the show and gathers all medical information and sends it accordingly usually are the ones who need a referral from their PCP to visit specialists. 

HMOs usually have a lower deductible but the patients are required to see only doctors and other healthcare providers within their network. 

Unlike the HMO, which limits the patient to designated providers only and makes sure that a referral is in place before the patient sees a specialist, PPO allows the patient to visit any healthcare provider of his/her choice, including specialists. 

PPOs have an array of preferred providers who, in return, provide favorable assessment, but patients can still choose to be seen by out-of-network providers, albeit, at higher costs. 

They are designed with minimal restrictions on health providers. As with the PPO, you may have to incur more extra-pocket medical costs over the HMO option.

After all, what is the best option – an HMO versus a PPO – depends actually on factors such as price, zones of providers, and how much you want to be flexible in the sphere of healthcare.

Is HMO Just an Acronym?

That’s true, HMO is a part of the list of abbreviations and it means Health Maintenance Organization. 

By that, it’s meant a kind of health insurance or a care plan that preciously cares about your health and eventually helps you to manage costs by trying to make doctors, you’re PCP the central point of all medical services. 

HMO typically demands patients go with one PCP from the PCP’s physician’s panel and get a referral from the PCP to get an appointment with the specialists. 

Here, the task is to provide preventive care, and concord delivery, which is cost-effective and leads to lower medical expenses. 

But then, it should be noted that HMO is mainly used as an acronym in the context of healthcare and it means a special type of health plan covering medical services of all sorts, as well as healthcare services of a preventive nature, at a reasonable cost.

What is PPO All About?

PPO stands short for Preferred Provider Organization, which is usually used as a term for a health plan or network. 

Beyond HMOs, patients can enjoy making their own decisions for providers outside the PPO. PPOs are unique in the sense that they include a portfolio of preferred providers, who offer their services at reasonable prices. 

Access to out-of-network providers may also be provided; however, their services will come with higher charges. 

Contrary to HMOs, which do need patients to have a primary care physician (PCP) and referrals, it is not a necessity for PPO patients to have these. The patients can bypass going through the PCP when they seek the consultation of a specialist directly. 

PPOs are the most common type, and they combine the provider choice of preferred fee-for-service with cost control, meaning that patients can still more or less receive whatever treatment options they need even while enjoying the benefits of cost control within the network. 

Generally speaking, PPOs are created to allow patients to have both flexible means and prompt access to treatment services.

Do HMOs and PPOs share Any Similarities?

Well, this can be called a close one as HMOs (Health Maintenance Organizations) and PPOs (Preferred Provider Organizations) may have some similarities but contrast significantly in certain aspects. 

They are groups of healthcare services or products provided in connection with risk through health insurance contracts of explicit or implicit types. 

In a like manner, both HMOs and PPOs have healthcare practitioners but in a different case. Such networks consist of doctors, hospitals, and other healthcare providers who make agreements with the insurance company to render services to plan clients.

Apart from the fact that both HMOs and PPOs cover a comprehensive list of health services, these plans offer such hospital services as preventive, diagnostic, treatment, and hospitalization.

These plans share the same features, but the main points of divergence revolve around managing finances as well as the type of care services. 

CSN Team.