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PPO Vs HMO - What's the Difference?


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What's the difference between a PPO vs HMO health insurance plan?

Which health insurance option is better? There are many things to consider. There's more to it than just the cost of monthly premiums.

PPO stands for “Preferred Provider Organization" and HMO stands for “Health Maintenance Organization". What does this alphabet soup of medical insurance acronyms actually mean in plain English?

The primary difference between a PPO and an HMO health insurance plan is that with a PPO you are free to get medical care from most any medical provider - regardless of whether the provider is a participating member of the PPO network.

An HMO, on the other hand, requires you to select a “primary care physician" from the HMO network, who would be responsible for “maintaining your health". This doctor would be responsible for referring you to other doctors for specialist care, from within the same HMO network. You cannot see a specialist without a referral from your primary care physician.

Which option is right for you? There are pros and cons to either one in the PPO vs HMO health insurance plan debate.

The primary advantages of an HMO are that your premiums generally tend to be lower and you typically do not have deductibles to meet, and that you have the benefit of having one primary care physician who is responsible for your overall health maintenance. This can be beneficial in the sense that the doctor would be very familiar with your medical background and you can develop a good rapport with that one doctor for all of your medical needs. The one major drawback with an HMO is that you are restricted in terms of where you can get medical care. You cannot go to an out-of-network hospital, unless it is an absolute emergency, for instance.

The primary advantages of a PPO are that you are not bound to one doctor. You don't need a referral from a primary care physician before you go see another specialist. You also have the flexibility to get medical care from professionals outside of the PPO network under certain circumstances. The major drawback of a PPO is that your premiums may be higher and you may have a deductible to meet, which means increased out-of-pocket expenses.

In the end, both PPO vs HMO plans require a significant outlay of money. Health insurance premiums and copays aren't getting any cheaper. But which one you choose between PPO vs HMO has a lot to do with the trade-offs between money vs convenience.

Not sure which one is right for you? Compare health plans now and get a free insurance quote.


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