PPO vs. HMO Health Plans

When purchasing a private health policy, you will typically need to choose between different provider network models. The two most common are Preferred Provider Organizations (PPOs) and Health Maintenance Organizations (HMOs).

HMO: Health Maintenance Organization

HMO plans focus on a local network of doctors who coordinate your care. With an HMO, you are required to select a Primary Care Physician (PCP).

• Referrals Required: To see a specialist, you must first get a referral from your PCP.
• No Out-of-Network Coverage: Except for emergencies, visits to doctors outside the HMO network are not covered.
• Lower Cost: Premiums and deductibles are generally lower than PPO plans.

PPO: Preferred Provider Organization

PPO plans offer more flexibility and a larger network. You do not need to choose a PCP.

• No Referrals Needed: You can schedule visits directly with specialists without a referral.
• Out-of-Network Care: You can see out-of-network providers, though the plan pays a lower share of the costs.
• Higher Cost: PPOs generally carry higher premiums and out-of-pocket deductibles.

Comparison Table