How to Evaluate Group Health Insurance HMO & PPO Plans
Group health insurance plans, such as those provided by an employer, may offer the option of using a PPO or an HMO. Before selecting a particular health plan, it is important to review all of the options and available benefits for both plans. So first gather the information that describes the options for each plan.
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Instructions
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Determine the type of health plan that you have available from your employer. You may have the option of choosing an HMO or PPO or have no choice at all.
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Read through the summary of benefits that should be included with the information provided about the health plan. You should also read through the plan member handbook for each type of health plan, if they are available.
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Look for information about the benefits that are covered, any restrictions that apply, and the total out-of-pocket costs that you will need to pay for different services.
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Examine the HMO plan to see what is required and if there is a provider in your area. You will be required to choose a primary care physician when enrolling in an HMO.
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Examine the PPO plan to see the options that are available and if your local doctor is in the PPO network. You are not required to choose a primary care physician for a PPO.
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Determine the best option based on the costs and benefits of each plan. Then pick the health plan that is suitable for you and your family.
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Tips & Warnings
An HMO is known as a Health Maintenance Organization. It typically costs less than a PPO, but you can see only doctors that belong to the network.
A PPO is known as a Preferred Provider Organization. It costs more than an HMO, but it has more flexibility to see out-of-network doctors.
Seeing a doctor outside of the HMO or PPO network may require you to pay either a higher co-pay or the entire cost of the visit.
