The Difference Between HMO and PPO Plans

When choosing health insurance, most residents in Sandy, UT, grapple with selecting either a Health Maintenance Organization (HMO) or a Preferred Provider Organization (PPO) plan. The fundamental difference lies in the size of the provider network. Fortunately, working with our agents at The Smith Insurance Group Inc. doesn’t have to be complicated.

Understanding HMO Health Insurance Plans

HMOs, or Health Maintenance Organizations, are networks of doctors, healthcare providers, and hospitals agreeing to render services at discounted rates. HMO plans only cover care from a provider within their network, barring emergency care. They might require you to select a primary care provider (PCP) who must authorize any specialist visits. On the upside, the premiums are usually lower for HMO plans, and in some instances, deductibles are low to non-existent. However, HMOs may often set more limitations on coverage.

Knowing PPO Health Insurance Plans

PPOs, or Preferred Provider Organizations, are a network of healthcare providers and institutions that cater to patients for a specific price. Here, you are not required to list a PCP or get referrals and are not confined to providers within the network. However, your co-pay for out-of-network visits might be higher than those for in-network providers. PPOs generally offer more laboratory service providers, giving you access to care wherever you travel. The trade-off is generally higher monthly premiums in exchange for flexibility.

Choosing the Right Plan for You

Choosing between an HMO and a PPO is not a matter of which one is better. The decisive factors are your budget and whether you require access to a broader network of specialists. Note that plans can vary amongst insurance providers. If you’re unsure which one to pick, let an agent at The Smith Insurance Group Inc., located in Sandy, UT, outline the pros and cons of various health insurance plans for you.