What’s with the alphabet soup? What’s it all mean? How will it inform your choices? Understanding the differences is essential to understanding health insurance.
HMO (Health Maintenance Organization)
Say your toe hurts and you’re on an HMO. Where do you go first, the podiatrist? WRONG! With an HMO, you must get prior approval and referral to a specialist from your PCP (Primary Care Physician.) And there are NO out-of-network benefits ever, except for emergencies. HMOs are a way for the insurance company to reduce costs by eliminating unnecessary testing and procedures by running everything by your PCP doctor.
At the end of the day, you have less control over your own medical care, and it can be a time suck. The Insurance Mom isn’t a big fan of the HMO model.
PPO (Preferred Provider Organization)
PPO’s use a network of providers and, by using these doctors, you get great price discounts. But it’s up to you to make sure your fave docs are IN-network. You can choose whatever doctors you like, whenever you like… No need for a PCP referral.
In CA, there’s no true PPO model anymore.
While you could choose to go to an OUT-of-network doctor, you’ll pay waaay more of your own dollars. These doctors don’t have to discount their fees and there will be a separate (and much higher!) deductible for out-of-network services.
And the one you may not be familiar with . . .
EPO (Exclusive Provider Organization)
In the EPO model benefits are available only IN-network. Like a PPO model, you can pick and choose your own doctors at any time, no need for a PCP referral.
One last thing about the different plan types and doctor networks. If you are purchasing a plan on your state’s exchange (in CA, it’s called Covered California), you may see a difference in networks with plans purchased on and off the exchange. So do your research before enrolling and let that information guide your decision making.
It certainly isn’t a rose but being informed is certainly sweet! (Shakespeare fans, anyone?)
