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HMO vs PPO Health Insurance

There are some employers that make employees and their family member a selection of healthcare plans. In order to make the right decision to meet your personal, economic, family and medical needs, it is important to know the difference between HMO and PPO healthcare programs, if you should be offered such a choice. This article will describe the differences between these two healthcare programs. This can be a very important decision, so having all of the facts can help you to make a better decision about the insurance that you choose.

HMO

Also known as Health Maintenance Organization, HMO plans are similar to insurance co-ops; certain physicians and other healthcare providers band together under a particular insurance company. They then offer fixed rates to people that are insured through this insurance company.

It is possible that under an HMO you may not be able to retain the services of your family doctor, if the doctor does not belong to that HMO. In most cases, you will be assigned to a Primary Care Physician. This doctor will be your initial contact for health coverage. In cases where a specialist is required, you will have to first go through your Primary Care Physician to get a referral to the specialist.

HMO plans are usually the least expensive plan to take. The co-payments are usually relatively low, or non-existent, and the premiums are usually less than those paid by a PPO. Many people complain that they feel like they do not get the personal treatment that they are used to under an HMO. It is often the case that physicians that belong to an HMO will keep treatment to a minimum, as they are working for lower rates. They also tend to try and see as many patients per day as they can to increase their company's profitability.

PPO

PPO's are also known as Paid Provider Organizations. These plans are rooted in a large group of caregivers, very much like an HMO. PPO's, however, have fewer restrictions. The PPO organizations are typically loosely organized, allowing the insured person and caregivers more flexibility in making decisions and taking more actions independent of outside influence.

It is easier to stay with your preferred doctor in a PPO. You should know, though, that if your physician is not a member of your PPO, you will have to either pay for any treatment, in whole, from your personal income, or you may have to pay the difference between your provider's charges and the PPO's set price for the same visit to a member provider.

PPO's are usually pricier than HMO's, but they are very popular nonetheless. Many people choose the option to go with a PPO because they offer more flexible options. It is easy to understand why many people would choose the PPO plan, especially when going with an HMO would result in no longer being able to see the family doctor who knows you and your medical history well and that you are more comfortable seeing.