What is an HMO? An HMO plan, otherwise known as a health maintenance organization, is the most comprehensive type of health insurance. In exchange for paying a monthly premium, HMO health plans cover the cost of most health care expenses. Most of the time, your main out-of-pocket costs with HMO insurance plans will consist of co-payments for prescription medications and doctor visits; these must be paid at the time of service. The cost of HMO health insurance plans generally remains steady, regardless of the amount of health care services you use.
To use an HMO insurance plan, you must first select a primary care physician (PCP). This doctor has to refer you to medical specialists in order for a specialist to be covered by your HMO health insurance plan. Moreover, your primary care and specialist physicians must be members of your HMO plan network. This can limit your options, so it is always important to examine the provider networks of a variety of HMO health insurance companies. This way, you can find out if any specialist doctors you may need are within the network.
Medical costs are often lower with HMO plans. Deductibles are either small or nonexistent, although the latter type of health insurance plan is becoming less common. However, going outside of the individual HMO plans’ network can be very expensive. Except for emergencies, you will have to pay the entire cost of out-of-network medical care by yourself. An HMO plan heavily subsidizes health care costs through fixed monthly capitation fees and other incentives for doctors to absorb costs; as a result, physicians often charge HMO health insurance plans less. While seeing a primary care physician in-network may cost a $10 to $40 co-pay, the full rate for going outside of the network could be several hundred dollars.
One of the benefits of HMO health insurance plans is that they have a significant focus on preventative care. The average HMO plan covers screenings and treatments, which allow many patients to take advantage of care sooner than those with plans that force them to cover the entire screening cost themselves. Patients with HMO health plans are likely to have illnesses that are caught earlier, before they turn serious. For example, cancer can be discovered in its earliest stages, when it is easier and less expensive to treat. In the long run, this can lead to better health and lower health insurance costs. In addition, HMO plans are more convenient than other kinds of health insurance. You do not have to file a claim in order to get your HMO health insurance plan to cover hospital stays or doctor visits within the network.
The HMO health plan can be a good value if you are satisfied with the doctors it covers. Some HMO insurance plans have wider networks than others. Before selecting an HMO plan, you should find out if your current primary care physician is included in its network, along with any specialists you may be currently seeing. There are individual practice associations (IPAs) comprised of doctors that contract with several individual HMO plans, but other doctors are exclusive to one network. There are also certain hospitals, labs, and express care/urgent care clinics in HMO networks that are covered.
Sometimes, you may choose a HMO health plan that doesn’t include your current PCP; or maybe you didn’t have an existing primary care physician at all. In that case, there are several factors you need to consider. First, you need to ask if the HMO plan includes your geographic area. What help is an HMO with inconvenient, far-flung physicians? It is recommended that you select an individual HMO plan that includes providers no more than 30 miles from your office or home. Also, the average wait time to see any new physician for routine care should be determined. Since this physician will exert considerable control over your health care, you must be comfortable with him or her and their treatment.
VitalOne can help you decide which HMO plan is right for you. Our licensed health insurance agents will provide you with HMO quotes from multiple providers in your state.
