HMO Vs PPO - Yes You Can Save and Secrets to Affordable Health Insurance... PPO vs HMO

HMO vs PPO...Health maintenance organization is a network group of doctors who have contracts with hospitals and clinics to service patients. Hmo insurance is usually for employed people and PPO is usually for self employed business owners.

If you are working for a company that provide health insurance then you most likely want to choose a hmo health plan simply because its cheaper in prices for doctor visits and prescription medication and the monthly premium can possibly lower too.
From experience HMO is the best choice who are employed or working for corporations.

PPO is the best choice if you are self employed or currently have cobra insurance. PPO also called Preferred provider organization which is also a network of doctors and specialist who have contract with hospitals to offer discount rates for service and treatment.

For example, my brother had a torn ACL in his knee which led him to the emergency room. Fortunately he had insurance and he was covered for emergency purposes by first paying a 150 dollar deductible for treatment. If he was admitted to inpatient service for hospital stay then the deductible of 150 dollars would be waived in this case.

After examination of his knee and many x rays treatment, the sports doctor advice him to have reconstructed surgery on his knee. I believe he had a 5k/5 thousand or 7500k/7500 dollars deductible but Im not sure but he would have to satisfy that deductible first before he can have surgery. I believe the total cost for knee surgery was around 12k or 12 thousand dollars.

The out of pocket maximum I believe in his health insurance policy is 4k or 4 thousand dollars. So the most total out of his pocket so far would be 9 thousand dollars if he had the 5 thousand dollar deductible insurance because 5k deductible plus 4 thousand out of pocket maximum equals 9 thousand total up front cost for the surgery.

The most he would ever spend on medical bills would be 9 thousand dollars total per year because the out of pocket is a per year plan. So, what is the true cost for my brothers knee surgery?


Remember a co-insurance kicks in after deductible is satisfied just like car insurance or auto insurance. Co-insurance is simply a percentage you pay for medical service after the deductible has been satisfied, My brother has 80% co insurance so this means he pays only 20% percent of the knee surgery bill. In any PPO or Hmo plan you get the network discounted rated for medical services after deductible is satisfied in this case. If you had 70% co insurance then you would pay 30% percent of the medical bill. If you had 100% co insurance then you pay zero or nada.

Having 100 percent co insurance for treatment is possible in some plans which is the ideal plan if possible because you pay zero for medical services. I always like this scenario if possible because I pay nothing for services.

To rephrase what I said earlier is that once the deductible is satisfied then you qualify for discounted rates and that means in some plans like ppo insurance pay discounted network rate and that includes a co insurance for services. Some hmo plans have zero co insurance as well too so you may want to look at the benefit plans package

Lets compare and see what is the best deal for affordable health insurance...should we choose hmo or ppo for lower health cost for you and family.

Im looking at one of the health insurance plans at the time of writing this article here and I see that hmo or health maintenance organization is definitely the best deal for the money. At least this is the case with this health insurance carrier.

Here is the example:

PPO plan


Deductible - $1000 to $3000

Co payment not applicable

Co Insurance 80% after deductible satisfied

Out of pocket
maximum $4000 to $8000


===============================

Hmo plan


deductible NONE

Co payment $20 - $30

Co insurance 100% after any co payment


Out of pocket $1500 to $3000
maximum



This is just a basic outline plan and these are cost scenarios for in network rates from one health carrier. As you can see here that HMO plans and benefits is much cheaper in this case. I did not include the out of network scenario because I want to make it really simple if possible to show why HMO are the better deal here.

There are no deductibles, 100 percent co insurance which is awesome and the out of pocket maximum is up tp 3000 thousand dollars. The PPO in this case is much more expensive because there is a deductible, co insurance required, and the out of pocket maximum is up to 8 thousand dollars.

So the winner here for sure is HMO.

Remember if you go to the doctor or specialist for routine visits you just pay a co payment which in this case is 20 to 30 dollars. Co payment is also applied to prescription drugs...deductible is not applied here for service.


Deductible:


The deductible in this plan only applies to the ppo plan...In some other health plans a deductible may be required in hmo plans in other companies. Also, deductibles will be higher for non-network service. Non network means that you're doctor or specialist is not in the network so make sure when you shop for health insurance plans that your hospital, doctors, and specialist are in the network so you can get the discounted rates.



Maximum deductible feature:

Some plans have this type of deductible so you may want to check this feature if you have at least three people in your family because you save more money in the long run. For example, a deductible of 5 thousand each person for a family of three equals to 15k thousand dollars total...a family deductible is beneficial here in the scenario. Some plans have A maximum family deductible of 10 thousand or less but check around for pricing.