Health Insurance shoppers faced with the decision of choosing a health insurance plan usually have a variety of choices. Health Maintenance Organization (HMO) Plan, and a Preferred Provider Organization (PPO) plan are some of the options you can choose from when choosing a plan.
People seeking insurance are looking at HMOs as a reliable alternative to reduce the cost of coverage.
HMO plans have been around for close to a hundred years. The first HMO plan is said to have been established in 1929 by the Ross-Loos Medical Group. There are different types of HMO plans depending on the type of organization you are in. Some options vary by type of organizational structure.
Under the “Group Model,” a group of physicians provide multi-specialty services to their members. Patients under this plan need to use the group to have their medical expenses covered. The Health Maintenance Organization model is also known as the “Closed Panel” the HMO hires physicians, specialists and ancillary care providers. Members must use these groups if they are to have their medical expenses covered. In the member model, members must pay for their own doctor’s services. The group model is a variation of the closed panel model with a variation.
Open Panel Model Under this model, the HMO has a list of participating physicians that a patient can go to. The doctors are not obligated to treat a patient, and they can treat non-HMO patients as well. Open Panel Model is a variation of traditional health insurance.
How HMO Plans work
Health Maintenance Organizations are a form of managed health care.
Primary Care Physicians – Generally, HMOs require that you have a PCP who will coordinate all your health care needs. This is typically a family care physician, an internist or pediatrician.
There is an important relationship that forms between a patient and a doctor when they have worked together for an extended period of time. Oftentimes, there is more than just running tests and taking blood samples to keeping a patient healthy. It is important that you feel very comfortable confiding in your main doctor. The primary care physician usually must authorize any specialists, labs, x-rays etcetera. He is the director of your health care.
Every HMO has a list of in-network doctors, specialists, labs, x-ray facilities and therapists. If the insured wants to have their medical expenses covered, they are required to use these approved providers. There are rare exceptions, and they are covered as part of the HMO policy.
Benefits of HMOs
HMOs offer very comprehensive coverage at the lowest cost of practically all forms of insurance. There are no maximum lifetime payout limits which are customary with other forms of insurance. Health Maintenance Organizations focus on the wellbeing of the insured. They encourage healthy living habits and encourage members to use preventive medicine. Health Maintenance Organizations usually provide free health screenings, offer gym membership discounts and provide members with various forms of health education.
Drawbacks of HMOs
HMO plans have limited choice of physicians and may not have your preferred doctor on the list. You also need to seek a referral for any specialty needs you have outside of your primary care physician. Different HMOs have levels of service that vary in turning these referrals around.
