HMO: Understanding Medicare Advantage Plans

Calendar Icon Updated May 07, 2019
Advantage Plans

Health Maintenance Organization (HMO) Plans are insurance plans that have tighter restrictions on which doctors and other providers you can visit to get covered care. This coverage is offered as a type of Medicare Advantage (MA) Plan to beneficiaries.

They generally require you to pick a primary care physician (PCP) and get a referral to see a specialist. They may have lower out-of-pocket costs than Preferred Provider Organization (PPO) Plans because of their coverage restrictions.

What Does HMO Mean For Your Health Insurance?

HMO Plans require you to use a specific network.

These types of plans maintain a network of contracted doctors, clinics, and hospitals to give care to their members. For health services to be covered on an HMO Plan, you must use a participating, or “in-network,” provider for your care.

The networks of doctors, specialists, and other providers vary by insurance company and plan. Some networks are relatively large, with several provider options in your area. Others are small, leaving you with only a few primary care doctors and specialists to choose from. It’s important that you check the provider network of an HMO Plan before enrolling to make sure it will meet your needs.

What if you need emergency or urgent care?

If you have an emergency—meaning your life or health would be seriously jeopardized without immediate attention—you can visit any emergency room and still receive coverage.

If you need urgent care and you’re not in your plan’s service area, you’ll be covered to see any provider, although you may need to submit your own claim to the insurance company. Urgent care typically includes conditions or injuries for which you need care within the same day to avoid a worsening, potentially emergency situation, like an ear infection.

What if you’re in a foreign country?

If you are traveling outside the United States, you typically don’t have coverage, except for some limited circumstances if you are near the U.S. border with Mexico or Canada. However, some MA HMO Plans offer an added benefit for worldwide emergency care. You’ll need to submit a claim to your insurance company to get reimbursed for coverage.

Your care is managed with HMO insurance.

Choose a primary care physician.

HMO insurance is about coordinating care to ensure quality and efficiency. That’s why plans usually require you to choose a primary care physician when you enroll. This physician will coordinate care with specialists and other providers if you need it. Proper care coordination helps reduce unnecessary and costly care, which is why these plans are often less expensive than PPO Plans.

Get referrals to see specialists.

Most plans require you to get a referral from your primary care physician before seeing a specialist. Your PCP will assess your condition and, if they believe it’s appropriate, will refer you to see a specialist within your plan network. If you see a specialist without a referral, your claim may be denied and you’ll have to pay for the visit out of pocket.

Fill your prescription drugs.

Most MA HMO Plans include coverage for prescription drugs, though that coverage is not universal. You’ll need to check with the plan company to find out what drug coverage it offers and which pharmacies you may use. Learn more prescription drug coverage at our Part D page.

Costs tend to be lower.

HMO Plans are typically less expensive than PPO Plans, both in premiums and out-of-pocket costs like deductibles and copays. This is because they are able to save money by tightly managing your care within a trusted network of providers.

There’s more to know.

  • Some MA Plans, including HMO, offer additional benefits such as dental and vision care or fitness programs.
  • This type of plan will tell you if your doctor or specialist leaves the plan’s network, and you’ll have a chance to choose a new provider. However, you won’t get the chance to choose a different plan until your next enrollment period unless your plan’s network changes substantially, as defined by Medicare.
  • If you don’t follow your plan’s rules, you may be on the hook for the costs of getting care.
  • Read more information here.

Micah Pratt

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