Health Maintenance Organizations (HMO's)

Health Maintenance Organizations (HMO's)

Health Maintenance Organizations (HMO's)
With a Health Maintenance Organization you are basically prepaying a set amount for health service at a specific healthcare facility, hospital, or group of health providers. The monthly rate you pay to the HMO is fixed regardless of the individual services you seek. Services are provided by physicians who are employed by, or under contract with, the HMO. HMOs vary in design. Depending on the type of the HMO, services may be provided in a central facility, or in the individual offices of participating physicians.

With most HMO’s there is a fixed copay of a nominal fee not like an 80/20 copay in a fee-for service plan. Typically this is something like $5 or 10.00 for a doctor's visit or $25 for hospital emergency room

treatment. Your total medical costs will likely be significantly lower and far more manageable in an HMO than with most fee-for-service insurance plans.

While HMO's have gotten a bit of a bad rap they also have another advantage over a traditional fee-for service plan. Because the very nature of an HMO requires they get a fixed fee for covered treatments for medical conditions, it is in their best interest to keep you healthy! Therefore they typically will provide preventive care, such as office visits, immunizations, well-baby checkups, mammograms, and physicals The range of services covered by an HMO vary greatly, so it is important to compare available plans and find one that suits your needs. Also the cumbersome paperwork that often accompanies a Fee-for Service Plan is eliminated with an HMO. Instead of dealing with claim forms etc. members simply present a membership card, like a credit card, at the doctor's office or hospital.

The downside of HMO’s is that they can be somewhat limiting when it comes to your choice of practitioners. In almost all HMOs, you either are assigned or you choose one doctor to serve as your primary care doctor. This doctor monitors your health and provides most of your medical care, referring you to specialists and other health care professionals as needed. You usually cannot see a specialist without a referral from your primary care doctor. This is what is meant by the term “Managed Care” where your primary physician is expected to “manage” the care you receive.

However the choices within an HMO are not as limited as one might think. In some HMOs, doctors are salaried and they all practice out of the same HMO facility building. In others, independent groups of doctors contract with the HMO to take care of patients. These are called individual practice associations (IPAs) and they are made up of private physicians in private offices who agree to care for HMO members. You may be surprised to find that the doctor you are already seeing, or one that is highly recommended by your friends or neighbors is already participating in an IPA network.

In any event, before choosing an HMO, it is a good idea to talk to people you know who are enrolled in it. Ask them how they like the services and care given.


Questions to Ask About an HMO:
Are there many doctors to choose from? Do you select from a list of contract physicians or from the available staff of a group practice? Which doctors are accepting new patients? How hard is it to change doctors if you decide you want someone else? How are referrals to specialists handled?

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