HMO vs. PPO

Difference Between HMO and PPO

In the United States the corporations are compelled provide employees with health care either in the form of compensation or a managed health program. The managed health program includes a medical teams and hospitals and clinics with all medical facilities. Two of the very famous managed healths programs present in the United States are HMO and PPO.

HMO

HMO (Health Maintenance Organization) asks the employer to provide the employees with a medical network that will include doctors, hospitals and clinics that will have all the necessary facilities. a Physician will be assigned to the employees who will act as a personal doctor and provide all the basic medical services. If an employee needs a specialist, then the Physician will have to refer the patient to a specialist who will be present within the network. In this case, the medical bill is the responsibility of the employer. If employee consults a specialist outside of the network, then the bill will come from the employee’s pocket entirely. Under HMO, doctors who are from the selected network can be chosen. An out of network service will cost the employee the full amount without any reimbursements.

PPO

PPO (Preferred Provider Organization) consists of a network of General Physicians as well as specialists. According to this program, the employee is at a liberty to select his preferred doctor. If the employee selects a health care provider that is from the preferred network, then the employee has to pay only for the predetermined annual deductible from their bill. However, if in any case the employee chooses to consult a physician from outside the preferred network then the employee will have to pay a higher amount and then he can file a request under PPO for a reimbursement. Unlike the HMO, employees under PPO choose to consult out of service physicians and they can be reimbursed later.