What is the difference between PPO and HMO coverage

by admin on June 29, 2009

The level of benefits and the amount of freedom to choose among physicians and hospitals are usually the two main differences. Benefits are also a key difference deductible, co-insurance, co-pays and networks.


Health Maintenance Organization provides very rich benefits – preventive care coverage and low out-of-pocket costs. There is typically no coverage for care from doctors or hospitals outside your HMO plan. Unless you have a Point of Service option or except in an emergency. HMO plans usually offer comprehensive benefits, affordable premiums with no deductibles and minimal cost- sharing. PCP or Primary Care Physician that you select from within the network oversees all your care. Unless you have a direct access feature in your plan – your Primary Care Physician will coordinate referrals to specialists when necessary.


Preferred Provider Organization is a network of physicians and hospitals that have agreed, by contract, to discount their rates to members. The networks are typically very large, and the members are free to seek care from any physician or provider within the network. Including specialists without a referral. Members may also access non-contracted providers, but at a higher out-of-pocket cost, this is called out of network benefit. PPO plans consumers usually have deductibles, co-pays, prescription benefits, and co-insurance.

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