This is a question I get almost daily here in WNY. Most people really do not understand the big difference. Here it is:
An HMO means everything you do as far as medical care MUST occur “in-Network”. That is , of course, excluding emergency care. First, you must have a PCP or Primary Care Physician. This doctor basically controls you healthcare. Any visits to specialists must be coordinated with your Primary Care Doctor.
Another important note about HMO coverage is that all your care must occur “in-network”. In most cases the insurance company specifies which hospital you need to go to, where you get blood work and where you go for medical procedures and tests.
On the plus side, HMO’s generally have much lower and often times zero premium. In addition, some have extra benefits like dental cleanings, vision care and some even have OTC or ‘over the counter” debit cards to use for non prescription health products.
PPO’s give you much more flexibility as far as your care goes. Although you will still have a PCP Doctor, you can can go to any doctor you choose providing he or she accepts Medicare. Also, you can pretty more go to whatever hospital you want and get tests and procedures done where you choose.
It is also important to know you can go anywhere in the country to receive care, This is important if you need or want to go to a specific specialist or hospital that is not in your area.
It also must be noted that the copays and deductibles are a little bit higher if you go out of network. The max-out-of-pocket is also a bit higher should you choose to go outside the network.
PPO’s also have extra benefits like gym memberships, dental cleanings and other perks.
The premiums are usually higher than HMO’s but not always. If you are considering a PPO, you should get with a Nationwide carrier like United Healthcare, Aetna or Humana as they have networks all over the country which is an added benefit.
Do not hesitate to call me if you need more clarification or have specific questions.