HMO Plans

Health Maintenance Organization, or HMO plans, is a type of Medicare Advantage Plan that offers a network of doctors, hospitals, and other providers you can choose from. Unlike PPO plans, HMOs will have you select a primary care physician, who will be the one that will give you referrals to see a specialist. Because of the in-network services, you’ll pay a lower premium compared to other Medicare plans.

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What are the benefits of HMO plans?

HMO plans are a type of Medicare Advantage Plan, which means that HMOs must provide the same benefits as Original Medicare. HMOs can also offer additional benefits, such as vision, hearing, and dental services. Other additional benefits include, but are not limited to:

  • Adult day-care services
  • Fitness memberships
  • Nutrition and wellness programs
  • Over-the-counter drugs
  • Services and supports for those with chronic conditions
  • Transportation to doctor visits

Even though you are restricted from choosing providers from outside of the network, you will pay a lower monthly premium because of this. You can also receive Medicare drug coverage, but you must enroll in an HMO plan that offers that coverage. Some plans will charge you a higher premium if you have drug coverage.

HMO plans will also cover any emergencies, such as urgent care or dialysis, that you receive outside of your plan’s network.

Costs for HMO plans

HMOs are required to set an annual limit on out-of-pocket costs. By having this limit, you can save money from spending too much out-of-pocket, especially if you need expensive care. For 2020, the maximum out-of-pocket limit is $6,700.

HMOs can also charge more for copayments when it comes to other services such as home health, durable medical equipment, and hospital care as an inpatient. However, they cannot charge more than what Original Medicare does for specific types of care, such as chemotherapy.

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Is an HMO plan right for me?

HMO plans are less expensive compared to PPO plans because of the lower monthly premiums. They also are beneficial if you receive the majority of your healthcare services close to home. However, if you are looking for more flexibility within a plan in regards to what medical facilities or providers you can see, then an HMO plan may not be the best option. Because of this lack of flexibility, your deductibles will also be lower. There is an exception with some HMO plans, which offer a point-of-service option. This option gives you the flexibility to choose a facility or provider outside of your plan’s network, but understand that this could raise your plan’s costs.