Health Insurance Options
As you shop around for health insurance, you will quickly realize there are many options to choose from. If you buy an individual or family policy, you will need to choose the type of provider network. You can choose from a policy that uses a PPO (preferred providers) or an HMO (managed care) network.
A PPO is basically a network of physicians and hospitals that agree to provide health care at a reduced cost to PPO members. An HMO, on the other hand, is a network of physicians and hospitals that offer cost-saving measures and are paid a fixed fee by the insurance company to provide medical care.
HMO Pros and Cons
The biggest advantage to choosing an HMO is you can take advantage of provider services with very little or no deductible. The co-payments are usually very low as well. You will only be able to see doctors within your HMO, however, and you will need to use a system to get a referral to a specialist. HMO policies do not pay for specialists who are not in the HMO network. An HMO health insurance plan also has higher premiums.
PPO Pros and Cons
With a PPO, you can use any doctor or specialist in the PPO network. The contract for payment is between the insurance company and the provider, so you will not be charged more than the lower negotiated price for services. If you see a doctor or hospital outside of the PPO network, costs will likely be much higher as you will pay full price.
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Health Insurance Options
As you shop around for health insurance, you will quickly realize there are many options to choose from. If you buy an individual or family policy, you will need to choose the type of provider network. You can choose from a policy that uses a PPO (preferred providers) or an HMO (managed care) network.
A PPO is basically a network of physicians and hospitals that agree to provide health care at a reduced cost to PPO members. An HMO, on the other hand, is a network of physicians and hospitals that offer cost-saving measures and are paid a fixed fee by the insurance company to provide medical care.
HMO Pros and Cons
The biggest advantage to choosing an HMO is you can take advantage of provider services with very little or no deductible. The co-payments are usually very low as well. You will only be able to see doctors within your HMO, however, and you will need to use a system to get a referral to a specialist. HMO policies do not pay for specialists who are not in the HMO network. An HMO health insurance plan also has higher premiums.
PPO Pros and Cons
With a PPO, you can use any doctor or specialist in the PPO network. The contract for payment is between the insurance company and the provider, so you will not be charged more than the lower negotiated price for services. If you see a doctor or hospital outside of the PPO network, costs will likely be much higher as you will pay full price.
