What is PPO and HMO?

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what is hmo and ppo
November 16, 2023 | Johanna Karlsson

Figuring out your health insurance needs requires careful consideration of a lot of things: your current health status, family coverage, and things like deductibles are all obvious to most of us. But some people forget to read the fine print and make sure their choice of insurance policy will actually help cover the things they need in their healthcare — and that all too often can include the impact of our choices on preventive care and wellness programs. You might be wondering, “What is PPO and HMO?”, and you could also realize by now that your choice of these two types of health insurance can make a big impact on your future coverage. But what, exactly, is the difference, and what do you need to know to make an informed decision? The HealthPlusLife team is here to help you understand. Before you give us a call to learn more about your options, let’s explain what you should know.

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What is an HMO?

When you hear about HMOs, think about the full name — Health Maintenance Organizations — to get a big clue as to how they approach healthcare coverage. This type of health insurance plan often will limit coverage to doctors who are part of the HMO, meaning they contract with or work for the organization. Out-of-network care and providers likely won’t be covered unless there’s an emergency, and you might have to live in or work in a specific service area to be eligible for the policy.

What is a PPO?

A Preferred Provider Organization (PPO) is a different type of health insurance plan that can offer more flexibility than an HMO. The plan will still typically contract with specific healthcare providers, including hospitals and doctors, and these participating providers will form the main network of your care, so you’ll pay less to see them. Unlike an HMO, you can still have some coverage if you choose to use providers and doctors outside of the specified network — but you can expect to pay an additional cost to do so.

HMO vs. PPO: Wellness Coverage

Now that you can see the basic structural differences and how things operate with HMO vs. PPO plans, we can explore how these differences might impact coverage for wellness programs.

PPOs are the more flexible option in some respects, with PPO members getting more options of wellness programs to choose from — not to mention the ability to choose programs both within and outside of their network. But these additional choices can come with additional out-of-pocket costs, especially when choosing things outside of the PPO network.

HMOs, meanwhile, often integrate wellness programs right into their offerings as a way of encouraging members to live as healthily as possible. You might be offered things like smoking cessation and weight management programs or even fitness memberships. However, the plan is more rigid than a PPO policy, and you may be required to get a referral from your primary care provider if you want to access specialized wellness programs.

what is ppo and hmo

How Do They Compare for Preventive Care Coverage?

At their heart, HMOs often will emphasize preventive care, covering things like annual check-ups, screenings, wellness appointments, and immunizations at little or no cost to you. Keeping people healthy helps prevent the need for more costly treatment in the future. But HMOs tend to be more restrictive than a PPO plan, requiring members to select a primary care physician who will focus on preventive care and coordinate specialized care as needed. Another consideration is the network limitations inherent in HMOs, with members limited to choosing from the specific network of contracted providers.

PPOs, on the other hand, offer greater flexibility in choosing providers. While they also cover preventive services, the range and cost could vary more than if you chose an HMO. But there’s no need to select a specific primary care provider, meaning you can directly visit specialists for preventive care. Out-of-network coverage is also another difference, though costs will tend to be higher out of the network, but that means you might be able to access necessary preventive services that aren’t included in the PPO network.

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Call Now (888) 828-5064 TTY 711

Learn More From HealthPlusLIfe About What is PPO and HMO

Now that you understand the basics when it comes to what is PPO and HMO, in this case how they approach coverage for preventive care and wellness programs, you’re ready to make an informed decision that will guide your healthcare coverage. You might not be confident yet though — it’s natural if you’re still wondering how to choose health insurance. But you don’t have to go it alone, and the HealthPlusLife team is happy to help you learn more about all of your options. When you’re ready to get expert help from our agents, contact us online or call 888-828-5064.

Johanna Karlsson
Johanna Karlsson is a veteran health and life insurance professional licensed in 50 states. She relocated from the countryside in the south of Sweden and has not looked back. After coming to the United States to attend university, she gained her degree in Public Relations. She brought her public relations skills to a local international health insurance where she discovered a new passion in insurance. After years with that company, Johanna now joins HealthPlusLife to help build a team of licensed insurance agents ready to meet your insurance needs.