When talking about health insurance, the word HMO and PPO is very common. However, many of us would definitely ask what do these letters mean and what is the difference between the two.
HMO (Health Maintenance Organization) and PPO (Preferred Provider Organizations) are the most common types of managed care plan. Many of us, employed and self-employed alike are enrolled in these types of plans.
If you are one of those who are enrolled with Health Maintenance Organization or HMO, you are then required to select a primary care physician to manage and coordinate all your health care and will serve as your personal doctor. If you are required to have a special care from a specialist or diagnostic service like lab test or x-ray, you still need a referral from your primary physician. When the referral is missing, you will then pay all or most of the cost from the said service done.
On the other hand, if you are enrolled with Preferred Provider Organization or PPO, is a plan wherein you need not to select a PCP or primary care physician and need not to seek referrals if you need to see other providers from the network. All you will have to be responsible for a PPO plan is your annual deductible and copayment for your visit. If you were to avail a service from a physician or hospital that is not in the network, you will get to pay a higher amount. In addition, you will also need to pay the doctor directly and later file for a claim with the PPO for reimbursement.
With the abovementioned difference, maybe you will now have an idea about what plan you will have to avail. It is advisable that you talk with your human resource office at work or with your health plan because above are the general rule.