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What is Health Maintenance Organization (HMO) Insurance?
A wide variety of health insurance providers offer their services with distinct features & benefits. The HMO meaning is simple. HMOs function on a network basis. Here the insurance coverage is restricted to healthcare services provided by a network of doctors & hospitals who are contracted to work with the HMO. The only exception may be a case of a medical emergency. HMO health insurance plans are generally lesser than regular healthcare policies.
People may find it useful to buy an HMO insurance plan if their personal physician is a part of any HMO network. They can also choose a primary care physician (PCP) for routine consultations & treatments. But you will need a referral from your physician to consult a specialist.
What is Exclusive Provider Organizations (EPO)
EPO Insurance is a type of health insurance plan that covers medical expenses only if the services are provided by doctors & hospitals within the EPO network. Except for medical emergencies, these plans do not offer coverage for treatment received from physicians, specialists, and hospitals not part of the network. EPO health insurance plans have a vast network of doctors & hospitals to provide the best medical care for its members.
EPO vs HMO
The primary difference between an EPO and an HMO is the requirement of a primary care physician (PCP) under HMO insurance for your medical treatments. The physician has to recommend you to a specialist for further consultations & treatments.
But EPO plans do not mandate their members to have a designated personal care physician. The members can directly consult the specialists if they are part of the EPO network. EPO insurance plans also offer a bigger network than HMO plans.
What is Point-of-Service (POS) Health Insurance?
POS plans are a combination of HMO and Preferred Provider Organization (PPO) plans. Just like HMO plans, it is necessary to have a designated primary care physician (PCP) who can make a referral to a specialist if required. Similar to a PPO plan, you can select a healthcare provider outside the network for which you need to pay a higher cost from your pocket.
What is Preferred Provider Organizations (PPO)?
The PPO Insurance meaning is quite simple. It involves a network of medical professionals & facilities that contract with health insurance providers. These ‘preferred providers’ offer higher benefits to the policyholders. Though they can choose out-of-network providers, policyholders enjoy the maximum benefit if they opt for in-network medical professionals.
But policyholders should mind the copayments that are required to be paid as a percentage of their medical bills. They may also have certain deductibles to pay before the insurance company starts settling the claims.
What is the difference between HMO and PPO plans?
Cost
A HMO plan typically has lower monthly premiums than a PPO plan with a comparable deductible.
Flexibility
A PPO insurance plan offers far more flexibility than an HMO plan. It allows you to choose healthcare providers that may be in-network or out-of-network. Though a PPO plan costs more, it offers you a wider choice of service providers.
PCP Referrals
HMO plans require you to select a primary care physician (PCP) who can refer you to a specialist if the situation demands it. But you do not need a referral from a PCP to consult a specialist in the case of PPO plans.
Comparing these differences between HMO and PPO plans can help you choose the right one.
EPO vs PPO Insurance Plans
An Exclusive Provider Organization (EPO) manages a network of healthcare providers with whom they work exclusively. Excluding cases of medical emergencies, an EPO will not cover medical treatments outside its network. EPO health insurance plans are generally cheaper than PPOs.
Preferred Provider Organizations (PPO) insurance plans are usually more flexible. You can choose healthcare services from both in-network and out-of-network providers. Their insurance premiums cost more than EPO plans.
POS vs PPO Insurance Plans
The primary difference between point-of-sales (POS) and preferred provider organization (PPO) plans is the flexibility factor. With PPO plans, you can select either an in-network or an out-of-network healthcare provider. You do not need a primary care physician’s (PCP) referral to consult a specialist.
But it is mandatory to have a designated PCP under a POS plan. Though you choose any healthcare provider, you can consult a specialist only after a PCP referral. Though POS plans have lower premiums, they offer lesser choices than PPOs.
Frequently Asked Questions About Types of Health Insurance Plans
Health Maintenance Organization (HMO), Preferred Provider Organization (PPO), Point of Service (POS), and Exclusive Provider Organization (EPO) are all types of managed health insurance plans. They are basically networks of doctors, specialists, and other healthcare providers that have contracted to offer medical services at negotiated rates to their members or policyholders.
The primary factors that differentiate between the four network types are their cost structures, flexibility in terms of in-network & out-of-network insurance coverage, and the requirement of a primary care physician (PCP) for referrals.
Healthcare providers get a steady stream of customers or patients due to the underlying network structure. They pass on the benefits to their members or policyholders, who can enjoy guaranteed access to medical services.
Disclaimer: The health insurance policy or plan may have limitations, exclusions, and other terms and conditions that may affect coverage. It is important to carefully review the policy wording before making any decision.