Whats the difference between a hmo and a ppo

What’s the difference between HMO and PPO plans?

Who is this for?

This information can help you if you're shopping for health insurance and want to learn how HMO and PPO plans are different.

When you’re shopping for health insurance, you have a lot of options to choose from.  

Knowing the differences between plans can help you choose the one that’s right for your health care needs and budget.

As you look at plans, you may notice that some plans are HMOs and some are PPOs, but what does that mean?

• HMO stands for health maintenance organization. 
• PPO stands for preferred provider organization. 

All these plans use a network of physicians, hospitals and other health care professionals to give you the highest quality care. The difference between them is the way you interact with those networks. 

With an HMO plan, you pick one primary care physician. All your health care services go through that doctor. That means that you need a referral before you can see any other health care professional, except in an emergency. Visits to health care professionals outside of your network typically aren’t covered by your insurance.

For example, if you get a skin rash, you wouldn’t go straight to a dermatologist. You would first go to your primary care physician, who‘d examine you. If your primary care physician can’t help you, he or she will give you a referral to a trusted dermatologist in your network that will. 

One exception to this is that women don’t need a referral to see an obstetrician/gynecologist, or OB/GYN, in their network for routine services such as Pap tests, annual well-woman visits and obstetrical care.

Coordinating all your health care through your primary care physician means less paperwork and lower health care costs for everyone.

PPO plans

PPO plans give you flexibility. You don’t need a primary care physician. You can go to any health care professional you want without a referral—inside or outside of your network.  

Staying inside your network means smaller copays and full coverage. If you choose to go outside your network, you'll have higher out-of-pocket costs, and not all services may be covered.

Which one is right for me?

If you prefer to have your care coordinated through a single doctor, an HMO plan might be right for you. And if you want greater flexibility or if you see a lot of specialists, a PPO plan might be what you’re looking for. 

For more information on HMO and PPO plans, check out our available individual and family plans.

First, let’s start with Original Medicare

Medicare is basic health insurance provided by the Federal government for people 65 and older, and people under 65 who meet certain criteria. When you sign up for Medicare, you are signing up for Part A and Part B. This is the first step to completing your Medicare coverage.

Medicare consists of 4 separate parts:

• Part A (Part of Original Medicare offered by the Federal government)
• Part B (Part of Original Medicare offered by the Federal government)
• Part C (Medicare Advantage plans offered by private insurance companies)
• Part D (Drug coverage offered by private insurance companies)

Why do you need additional coverage?

Many people discover that relying on Original Medicare (Part A and Part B) doesn’t provide enough coverage. With Original Medicare, there are gaps in your coverage. For example, Original Medicare only covers 80% of Part B expenses after the annual Part B deductible is met. The remaining 20% is your responsibility and could add up to thousands of dollars each year. Plus, Original Medicare doesn’t include Part D prescription drug coverage, routine vision and hearing exams, and certain other services.

In order to have enough coverage, many people choose to enroll in a Medicare Advantage plan.

How does an HMO plan work?

An HMO plan is a Medicare Advantage plan (Part C) that offers everything Medicare covers plus additional benefits such as prescription drug coverage (Part D), vision and hearing exams, preventive dental coverage, and discounts on fitness programs. In addition, Medicare Advantage HMO plans can help save you money with monthly premiums as low as $0 and an out-of-pocket maximum that limits what you pay for medical services in a year.

With a Medicare Advantage HMO plan, you choose a primary care physician or PCP to be your main doctor. Your PCP keeps track of all the care you receive and refers you to specialists if needed. Your PCP makes sure you get the care that is right for you. Your PCP can also help you avoid unnecessary expenses such as duplicate tests. This is one of the advantages of an HMO plan—having a team behind you to make sure you are getting the right care.

How does a PPO plan work?

A PPO plan is also a Medicare Advantage Plan (Part C), but it works differently than an HMO plan. With a PPO plan, you don’t have a PCP. Instead, you can access any doctor or hospital, but you would be responsible for coordinating your care. Seeing doctors inside the network will generally have lower costs for services than seeing a doctor outside of the network. A PPO plan provides everything Medicare covers plus additional benefits such as prescription drug coverage (Part D), vision and hearing exams, preventive dental coverage, and more. A PPO plan can have a monthly premium as low as $0 and an out-of-pocket maximum that limits what you pay for medical services in a year.

Which is right for you?

Choosing between an HMO and a PPO plan comes down to how you see your doctor. An HMO plan will provide more of a partnership with your doctor, and a PPO plan will allow you to access any doctor or hospital. At CarePartners of Connecticut, we have a team of Medicare Agents available to answer all your Medicare questions and help you find the plan that’s right for you. CarePartners of Connecticut offers several HMO plans and a CarePartners Access PPO plan. Just call 1-888-341-1507 (TTY: 711).

You can also compare plans on our website.