HMO is an insurance structure that provides health coverage to patients through a network of physicians. HMO requires that participants first receive medical care services from a primary care physician.
However, it would generally require a referral from their primary care doctor if they need to see a cardiologist, specialist, or dermatologist. It is important to note that HMO is not a one-size-fits-all as other health insurance plans are available.
However, these available health insurance plans vary in coverage, cost, rules, and network sizes. HMO is one such insurance plan, which stands for health maintenance organization.
HMO is known for being one of the most affordable health insurance plans. However, it does not offer the flexibility found in other plans.
HMO consists of a group of medical insurance providers that help limit coverage to medical care provided through several doctors in hospitals who have a contract with the HMO.
The hospital and doctor’s contract with the HMO allows them to provide medical care to you. These contracts allow lower premiums at a monthly or annual fee.
They cover the cost of medical services through in-network doctors and hospitals. They can use out-of-network doctors and hospitals in an emergency.
How HMO Insurance Plan Works
As a member or user of HMO insurance coverage, you will have to pay a monthly or annual fee to be a partaker of their services, the fee is called a premium.
The coverage is usually limited to offering medical care through a network of healthcare providers with a contract with the HMO.
The contract allows the medical fees to be lower than the usual amount since the healthcare facility has the advantage of giving patients direct access to them, which is why HMO premiums are affordable.
When patients receive medical care from their HMO, the health insurance company covers a significant percentage while paying the rest from their pocket.
The amount you pay is called out-of-pocket costs, copayments, or coinsurance depending on the specific plan you have chosen.
It is imperative to note that HMOs do not cover the medical care you receive from out-of-network, that is if you choose to visit a hospital that is not a part of the HMO provider networks.
In the event, you receive care from out-of-network hospitals and doctors, you will be responsible for the full medical bill unless you are receiving an emergency or urgent care.
HMO Insurance Plan Costs
The cost of an HMO insurance plan depends on several factors; one of them is where you purchase the coverage, such as a private health insurer or an individual plan.
Buying an individual or family health care plan on your own usually costs less than trying to enroll in an HMO through your employer’s group insurance.
Group health insurance premiums are subsidized by employers, which lowers the amount of money you get to pay from your paycheck.
Some of the factors that will influence the premium you pay on HMO are as follows:
- Tobacco use
- Plan tier (Bronze, Silver, Gold or Platinum)
- Dependents (Spouse and children)
Benefits of HMO
HMO offers lots of benefits; below are some of them:
- Lower out-of-pocket cost- the plans come with low or no deductible, low copays, and low out-of-pocket costs making the overall billing less complicated.
- Primary care physician directs you to treatment- your PCP will manage your treatments and care.
- Higher quality medical care- the quality of care you get on the HMO plan is high as patients are treated well and on time.
Why Should I Get an HMO Insurance Plan?
You should get an HMO insurance plan if you desire an affordable health insurance plan because, compared to other plans, HMO is less expensive.
You should get an HMO insurance plan if you do not mind working with a primary care provider, which allows you to get referrals to see specialists.
Why do I need a Primary Health Physician when I have an HMO?
You need a primary health physician even though you have an HMO because health insurance plans generally require a doctor who would coordinate your care and also provide referrals to you if you have to see a specialist.
What are the Examples of HMOs?
HMOs have several examples, such as Cigna, Humana, Aetna, and many others
What are the downsides of HMO?
Some of the downsides of HMO include the following:
Must use medical professionals in the plan’s network
This means users have to see a designated doctor for all their healthcare needs, including primary care and referrals.
The downside is that the doctors must be part of the network.
If you decide to see a doctor outside the network, you will be responsible for the costs.
There are no specialist visits without a referral
You cannot visit any specialist, such as Dermatologist or rheumatologist, without a referral.
Emergencies must meet certain conditions:
If there are cases of emergencies, you have to meet specific conditions, such as the definitions that constitute an emergency, if your health condition doesn’t meet the criteria, your HMO plan will not pay for the medical bills.