What are PPO and HMO?

A PPO is a Preferred Provider Organization and HMO stands for Health Maintenance Organization. To speak about HMO, we can save a lot of money by paying a low premium amount since the insurance company has negotiated discounts on hospitals and doctors in a given area, but options are more limited and should stay within the network to receive coverage. In the interest of efficiency, HMO takes a large decision about the surgical procedure, health care professionals instead of letting people making their own decisions. In PPO, we are provided with more responsibility about health care decisions and we pay more for that. It allows choosing our physician from a larger group of network. Unlike an HMO patient, we can move out of the network but the cost will increase. HMO offers a smaller premium but more restrictions. PPO’s cost a little bit more and encourage you to stay within a network and gives a more option that an HMO.