Whats the difference between an HMO and PPO?
An HMO contracts with hospitals and providers/pharmacists to charge a contracted price for products/services at a discounted rate. This allows you to pay a lower premium and fewer out-of-pocket expenses. You must only go to a participating provider and when going to a specialist, you must first get an approval and referral from your primary care physician. A PPO allows you to go outside their network for a reduced paid benefit (i.e. the patients out of pocket cost might be 20% when going to a participating provider, but when going out of the network, the patient would pay 30 or 40% out of pocket). With a PPO, the benefits would still be paid, only at a reduced rate. An HMO would pay nothing towards a claim that was from a non-participating provider.
