Important factors to consider when comparing an HMO to a PPO include out-of-network coverage, if out-of-network spending applies to the out-of-pocket maximum, and the need for a primary care physician, notes WebMD. Employees should contact their human resource office for the specifics of the plans that are offered.
A health maintenance organization, or HMO, typically requires that enrolled members receive care from a health care provider who is within the network of approved providers, explains About.com. Members enrolled in an HMO must choose a primary care physician, or PCP, who is responsible for the health care of the member. PCPs can be family physicians and internal medicine physicians. Children PCPs can be either family physicians or pediatricians. If the patient requires specialized care, the patient needs to receive a referral from his PCP.
A preferred provider organization, or PPO, contracts with a network of providers to provide care to its members, explains About.com. These preferred providers include general practitioners, internists, specialists, labs and imaging facilities. In a PPO, the member can choose to go to any of the providers in the network without needing to declare a PCP or getting a referral. When the member receives care from an in-network provider, he is typically responsible for a copayment and an annual deductible. If the patient receives care from an out-of-network provider, the patient needs to pay the provider directly and file a claim with the insurance company.