A Health Maintenance Organization (HMO) is a type of managed care health insurance system where subscribers pay a set fee in exchange for access to a network of medical services and resources. An HMO utilizes contracts with providers, including doctors, hospitals, and other healthcare organizations, to offer its members a set package of services at an established cost.
Why Do People Choose HMOs?
HMOs offer their members a range of advantages. These include access to quality medical care, cost savings, and a likelihood of enhanced continuity of care as a result of working with a network of providers. Subscribers can typically receive medical care from any doctor or medical facility that is part of the HMO’s network and will only have to file paperwork with the HMO after the fact. In addition, depending on the plan, HMOs can also provide additional services such as dental, vision, or mental health.
Are HMOs Right for Everyone?
While HMOs can provide certain advantages to their members, they also come with certain drawbacks. Most HMOs require subscribers to select a primary care physician who coordinates medical care. Treatment from a provider outside of the HMO’s network is usually not covered, meaning subscribers must pay out of pocket for those services. Additionally, subscribers may also incur out of pocket costs for certain preventative services, such as lab tests.
Due to these drawbacks, HMOs may not be the best choice for everyone. It is important for prospective members to thoroughly evaluate their options so they can make an informed decision when selecting a health care plan.