Upgrading Plans During Enrollment: Why Is PPO Better Than HMO?

With Open Enrollment in effect through the end of the year, now is the time to upgrade or alter any existing plans to improve healthcare coverage. For those considering a change, it’s crucial to understand the difference between Preferred Provider Organizations (PPOs) and Health Maintenance Organizations (HMOs). These insurance plans for healthcare provide a myriad of benefits, including Medicare. It’s generally understood that PPOs give consumers more options, but choosing between the two can be quite a challenge for many when it’s time to renew or update those policies. So, why is PPO better than HMO when it comes to coverage?

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Is It Worth Getting PPO?

When choosing between a PPO and an HMO, your needs, priorities, and budgets are the first factors to consider. PPOs, while generally the more preferred option, have their strengths and weaknesses to consider, including:

Pros

• Choose Your Doctor. A person’s primary care physician is privy to the most intimate details about their life. As such, patients aren’t always keen on changing their provider simply because their insurance company doesn’t work with them. With PPOs, individuals choose their preferred doctors (hence, Preferred Provider Organization). 
• No Referrals Needed. Since individuals choose their doctor, they can also see a specialist without needing a referral. This cuts down on the time it takes to see much-needed experts in specific types of care compared with the alternative.
• Better Care Potential. With PPOs, there’s a much wider network of care providers and usually more highly recommended doctors. If a patient needs a second opinion on a concerning symptom, that’s far easier to accomplish with more available doctors.

Cons

• Higher Monthly Premiums. To keep so many doctors in-network, insurance providers need to negotiate contracts with healthcare practitioners and hospitals, which can cost the company more upfront. That increase in price for them is often reflected in those monthly premiums for individuals.
• Likely Out-Of-Pocket Costs. Most insurance plans do not cover copays, deductibles, and fees for seeing out-of-network specialists, so consumers pay the difference themselves.

Fans of PPOs consider the extra expenses associated with this type of insurance to be the price of admission for such an abundance of flexibility in selecting doctors.

Why Do Doctors Prefer PPO Over HMO?

While both options are accepted by doctors nationwide, health professionals sometimes play favorites. There are a few reasons why PPO is better than HMO in the eyes of providers, including:

• Higher Reimbursement Rates. Doctors typically make their money through insurance reimbursement. On average, HMOs don’t pay as much, meaning your care provider earns more for the same services when their patient is covered through a PPO instead.
• Less Restrictions. HMOs often require prior authorizations and referrals for patients to see specialists or for doctors to prescribe certain treatments and medications. This isn’t the case as much with PPOs, meaning the administrative process is streamlined, and health professionals can spend more quality time delivering better care to their patients.
• More Flexibility in Treatment Options. HMOs are very restrained when working outside their network or circumventing coverage rules for certain treatments. This poses an obstacle for patients who need a care team to manage a complicated illness or need to try something experimental. PPOs allow doctors to work with colleagues they prefer and in facilities they’re familiar with, giving them far more control over the types of care they can offer patients.
• More Potential Patients. Since individuals have more freedom to choose their doctor when they have a PPO, the pool of options for potential patient/caretaker relationships is much wider. Not only do people get more access to physicians, but those professionals also gain more clients.

While HMOs are often more budget-friendly for some, the limitations they place on healthcare workers can often negatively impact the quality of care. This is why PPOs are better than HMOs for many.

What Is the Main Advantage of PPO?

The number one benefit of a PPO is the flexibility offered to patients when choosing healthcare providers and treatment options. Without a referral to see a specialist, individuals can hand-pick their wellness team, seek alternative methods of care, and make medical choices with fewer limitations. This advantage is paramount for several different factors:

• Personalized Care. By choosing providers aligned with their health goals, patients can take a more hands-on approach to their medical care, ensuring it’s customized to their preferences. Additionally, people who have chronic conditions and require regular visits to specialists can have peace of mind knowing they’re better covered and can access their doctors quickly when needed.
• Faster Access. With HMOs, referrals are needed to see a specialist. Due to supply and demand for their niche skills and knowledge, those types of doctors can often have limited appointment spaces for months at a time. That means timing prior authorization with primary care providers can hinder access to care.
• Care Anywhere. For people who travel a lot, the fear of getting injured or sick while away from home can be daunting, especially when paying for it. With PPOs, as long as the caregiver is within a network, patients can see them without breaking the bank. Additionally, with many more options available through a PPO, there’s a greater chance of an in-network provider being nearby.

What Are 3 Disadvantages of HMO?

With typically more affordable monthly premiums, some people find HMOs more affordable than PPOs. For example, a young, healthy individual who rarely gets sick and never sees specialists might not benefit from so many in-network doctors to choose from and may opt to pay less per month instead. Three disadvantages of selecting an HMO include:

• Greater Restrictions. With a smaller network of contracted providers, options are often limited when choosing a doctor. Additionally, patients with complex conditions or those who regularly see specialists may struggle to find providers that are both in-network and meet their needs. If one can’t be found, going out-of-network will likely require paying the full cost out-of-pocket.
• Referral Requirements. HMOs require doctors to obtain prior authorization from insurance companies to see a specialist or receive certain medications and care. This administrative roadblock can hinder speedy access to care.
• Gatekeeping. Primary care providers act as gatekeepers, controlling access to specialists and certain treatments. This can be frustrating, particularly if you believe you need a specific treatment your physician is reluctant to approve.

Switch to a PPO With Expert Help From Health Plus Life and Learn Why Is PPO Better Than HMO

Why is PPO better than HMO in the minds of many healthcare professionals and patients? It comes down to flexibility and access, which varies in priority from person to person. When choosing between a PPO and an HMO, it’s important to consider your specific healthcare needs and budget. While HMOs might be more affordable for healthy individuals, the flexibility of choosing any doctor without a referral might be worth enough in other ways to balance out the monthly or out-of-pocket costs over the long term for others.

Navigating the Health insurance marketplace website can often confuse people who may not be well-versed in insurance language and commonalities. Avoid complications when starting, renewing, or upgrading your plans during this year’s Open Enrollment season; in the same way that it’s prudent to hire a doctor when unsure about caring for your health, letting an expert assist when it comes to figuring out how to pay for it all is just as wise. Contact HealthPlusLife at 888-828-5064 to learn more about accessing HMO or PPO insurance plans.