What is the difference between an HMO and a PPO?

The main difference between an HMO plan and PPO plan is flexibility and price.


HMO stands for Health Maintenance Organization. With an HMO you must choose a primary care provider (PCP) from a network of doctors. Your PCP will refer you to other doctors and clinicians within that network for any specialized care you may need. HMOs generally have lower premiums and lower overall out-of-pocket costs than equivalent PPOs.


PPO stands for Preferred Provider Organization. With a PPO, you can go to any doctor or facility you’d like without a referral, though you will pay less for services from doctors and facilities who are in-network. PPOs generally have higher premiums and higher overall out-of-pocket costs than equivalent HMOs.


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