HMO vs. PPO: Which is right for you? (2024)

FAQs

Is HMO or PPO better for me? ›

HMO plans typically have lower monthly premiums. You can also expect to pay less out of pocket. PPOs tend to have higher monthly premiums in exchange for the flexibility to use providers both in and out of network without a referral. Out-of-pocket medical costs can also run higher with a PPO plan.

Is an HMO or a PPO plan better? The best health plan is the one that meets your needs. If you like lower costs and think coordinated care makes things easier, an HMO plan might be a good choice. If you want to continue seeing a doctor or specialist that isn't in your employer's HMO network, think about a PPO plan.

PPOs are the most common plan type. Forty-seven percent of covered workers are enrolled in PPOs, followed by HDHP/SOs (29%), HMOs (13%), POS plans (10%), and conventional plans (1%) [Figure 5.1]. All of these percentages are similar to the enrollment percentages in 2022.

PPOs Usually Win on Choice and Flexibility

If flexibility and choice are important to you, a PPO plan could be the better choice. Unlike most HMO health plans, you won't likely need to select a primary care physician, and you won't usually need a referral from that physician to see a specialist.

With a PPO, you do not need to maintain a primary care physician and can see a different doctor of your choice at any time, including specialists. This also means when you are traveling, you can receive care wherever you are. Additionally, PPO plans offer more options for laboratory service providers.

In an HMO there are some disadvantages. The premium that is paid is just enough to cover the costs of doctors in the network. The members are “stuck” to a primary care physician and if managed care plans change, then the member may not be able to continue with the same PCP.

What Are Disadvantages of PPO Plans? PPO plans tend to be more expensive than other managed-care options. They typically have higher monthly premiums and out-of-pocket costs, like deductibles.

While the majority of people in the United States have private health insurance, primarily through an employer, others obtain coverage through programs offered by the government. Yet some do not have health insurance coverage at all (refer to the “What Is Health Insurance Coverage?” text box).

Health benefits of human milk oligosaccharides in adults: Gut health. In babies, HMOs stimulate the growth of Bifidobacteria. These HMO prebiotic benefits are seen in adults, too, alongside HMOs' ability to modulate the immune system, benefit brain health and regulate the gut barrier.

Do HMO have high premiums? ›

A Health Maintenance Organization (HMO) plan is one of the most affordable types of health insurance. While it may have coinsurance, it generally has lower premiums and deductibles. It also often has fixed copays for doctor visits.

The Primary Disadvantage of an HMO Plan

HMO plans do not give you the flexibility of the PPO plans that many people have become accustomed to using. You are limited to a smaller (typically local) network of providers – usually a particular hospital system.

An HMO is a good choice if you want the cheapest health insurance and don't mind staying within the plan's provider network. A PPO would probably be the better option if flexibility is what you prefer, even if it means higher health insurance costs. Out-of-network care? Need to name a primary care physician (PCP)?

If you have control over what policy you enroll in—be it a traditional group health plan or an individual plan—and want a policy with more flexibility, a PPO plan can be an excellent option to get the quality of care you need. This article was originally published on March 31, 2021.

The main benefits are cost and quality of care. People who purchase HMO plans enjoy lower premiums than traditional forms of health insurance.

HMOs provide benefits on a prepaid basis. HMOs contract directly with employees. PPOs aim at providing high - quality health services at high costs. PPOs focus on preventive measures and outpatient care.

A type of medical plan in which coverage is provided to participants through a network of selected health care providers, such as hospitals and physicians. Enrollees may seek care outside the network but pay a greater percentage of the cost of coverage than within the network.

Many people choose an HMO plan because it covers everything Original Medicare covers plus additional benefits. HMO plans generally have lower monthly premiums than Medicare Supplement plans and are available with prescription drug coverage, so you can have medical and drug coverage in one plan.