The Difference Between A HMO And A PPO

When considering health coverage plans for a Medicare supplement, the options may include those known as HMO plans and those known as PPO plans. Both coverage options can provide the same levels of coverage for doctor's visits, hospitalization, prescription drugs and more. The primary difference between an HMO and a PPO is the role of the doctor you see for your basic care. With a PPO, you may see a doctor for physicals and general health care, but with an HMO, this doctor may be your primary care physician, who also provides referrals to specialists. But an HMO may be the more affordable choice in some cases.

What is an HMO?
HMO stands for Health Maintenance Organization. If you choose an HMO for your Medicare supplement, you may choose a primary care physician or one may be selected for you. The primary care physician, any specialists you see and any facilities where you receive care will be part of the HMO network of approved providers. This primary care physician may be the physician you see for basic care, but their role with an HMO is to help you choose specialists within the HMO network and provide referrals to same. For women, you may be able to select a gynecologist as your primary care physician, but if your plan does not allow for this, gynecological care may require the same process as for other specialists. If you want to see a provider outside the network, you may be required to pay some or all of the fees the provider charges.

What is a PPO?
PPO stands for Preferred Provider Organization. You do not need a primary care physician if you choose a PPO Medicare supplement. In essence, you self-refer with a PPO, choosing your own specialists within the network.  Out of pocket costs may be higher with some PPO plans, including co-payments, premiums or lower coverage for out of network providers. Some PPO plans include a deductible. If you don't mind paying a little more, and the network includes specialists you would like to see without need for referrals, a PPO Medicare supplement might be for you.

Which one should I choose?
Both types of plans include provider networks, and charge more for seeing providers outside the network. When considering coverage plans for a Medicare supplement, look at the provider network listing, and make sure that it includes the doctors and hospitals that you'd like to see or continue seeing. Consider your ability to follow up with the process for referrals, and ask about that process when considering an HMO. Mistakes with the referral process can cause you to miss appointments or be charged for care that is normally covered. If you are considering a PPO, ask about premiums, deductibles, and other coverage costs. And as you manage your own visits to specialists with a PPO, if you need to see several specialists, it's important to keep your own records for remembering which providers you need to see. A PPO can provide greater freedom, but at a slightly greater cost. With both types of plans, the insurer and specific plan can vary in terms of what they will cover and to what extent they will cover it. Review the information you receive about benefits, and ask questions before making your decision.