We know: Difference Between HMOs and PPOs

What's a managed health care plan?

Managed care plans generally provide comprehensive health services to their members, and your coverage is paid in advance. Two of the major types are:

HMO - health maintenance organization
PPO - preferred provider organization

How are HMOs and PPOs alike?

With both HMOs and PPOs, you generally pay a monthly premium whether you use any healthcare that month or not. You may also have to make co-payments for office visits or prescriptions.

Both HMOs and PPOs have contracts with doctors, hospitals, and other providers. They have negotiated certain fees with these providers-and, as long as you get your care from these providers, they should not ask you for additional payment. (Of course, if your plan requires a co-payment at the time you receive care, you will have to pay that.)

What is different about an HMO?

With an HMO, you typically must receive your medical care through the plan and the member doctors and hospitals in the plan. Generally, you will select a primary care physician who coordinates your care and refers you to specialists when needed, who are usually also part of the HMO.

Advantages of HMOs
You generally have few out-of-pocket expenses for medical care-as long as you use doctors or hospitals that participate in or are part of the HMO. Your share may be only the small co-payments; generally, you will not have deductibles or coinsurance.

What is different about a PPO?

With a PPO, you will get some reimbursement from you insurer if you receive a covered service from a provider who is not in the plan. Of course, choosing a provider outside the plan's network will cost you more than choosing a provider in the network.

Advantages of PPOs:
PPOs offer more flexibility than HMOs in choosing the doctors you can see, but premiums are likely to be somewhat higher, and there may be more out-of-pocket expenses.

Are there late fees?

These services usually have no return dates, so there are no late fees. However, you must return the DVDs you have in order to get others.

How do I get health insurance?

Health insurance is generally available through groups and to individuals.

Group insurance premiums-the regular fees that you pay for health insurance coverage-are generally lower for group coverage. You may get group insurance at work, or through a professional or other organization.

When you receive group insurance at work, the premium usually is paid through your employer, however, this benefit is no longer offered by some employers.

Individual insurance is may be an option if you're self-employed or you company does not offer insurance. It allows you to tailor a plan to fit your needs from the insurance company of your choice. It requires careful shopping, because coverage and costs vary from company to company.

In evaluating policies, consider what medical services are covered, what benefits are paid, and how much you must pay in deductibles and coinsurance. You may keep premiums down by accepting a higher deductible.

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