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HMO vs. PPO: Which is Right for You?

By   ·  1 minute read

When choosing health insurance, you might see "HMO" and "PPO." These are two kinds of health plans. Let’s explain what they mean and help you decide which one is better for you.

What is an HMO Plan?

HMO stands for Health Maintenance Organization. In an HMO plan, you have a list of doctors and hospitals to choose from. You need to pick a main doctor (called a primary care doctor). This doctor helps you with most of your healthcare and will send you to a specialist if needed.

Good Things About HMO Insurance:

  • Costs less: HMO plans usually have lower monthly payments and fewer out-of-pocket costs.
  • Doctor helps you: Your primary doctor manages your care, so you don’t have to worry about what to do next.

Bad Things About HMO Insurance:

  • Fewer choices: You can only see doctors in your network. If you go outside the network, you pay more.
  • Need a referral: You have to get a referral from your main doctor before seeing a specialist.

What is a PPO Plan?

PPO stands for Preferred Provider Organization. In a PPO plan, you do not need a main doctor. You can see any doctor or specialist, and you don’t need a referral. However, it costs less if you stay in the plan’s network.

Good Things About PPO Insurance:

  • More choices: You can see any doctor you want, even without a referral.
  • Bigger network: PPO plans usually have a larger group of doctors and hospitals to choose from.

Bad Things About PPO Insurance:

  • Costs more: PPO plans often have higher monthly payments and higher costs when you go to the doctor.
  • You manage your care: You have to decide when to see a specialist because no one is managing your care.

Which Plan is Right for You?

Choosing between an HMO and PPO depends on what you want.

  • If you want to save money and don’t mind seeing certain doctors, an HMO plan may be the best choice.
  • If you want more freedom to pick any doctor and are okay with paying more, a PPO plan might be better.

Think about what matters most to you. Do you care more about cost or being able to pick any doctor? Once you know that, you’ll be able to choose the health policy that works for you.

Want to quickly see the differences between plans and coverage? Join the waitlist for our new health insurance comparison tool. You'll get early access to time saving and a better understanding of what you're buying.