Medicare HMO vs. PPO

Health Maintenance Organization (HMO) and Preferred Provider Organization (PPO) plans are the two most popular types of Medicare Advantage coverage. However, many people do not understand the differences between Medicare HMO vs. PPO plans before they are ready to enroll. Thus, many blindly sign up without understanding the full effect of their plan’s benefits and coverage.

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When it comes to PPO vs. HMO Medicare plans, there are many similarities and differences to consider. So, understanding the benefits each plan provides is essential. Below, we review Medicare PPO vs. HMO plans to help you determine which choice is most suitable for you.

What is the Difference Between Medicare HMO vs. PPO Plans?

Medicare HMO vs PPO

To enroll in an HMO or PPO Medicare Advantage plan, you must first have Original Medicare (Part A and Part B).

HMO plans, or Health Maintenance Organizations are more restrictive healthcare coverage. These plans let you choose one primary care doctor who can refer you to specialists for more in-depth care based on your needs. This is a great option for someone who is relatively healthy and does not frequently visit the hospital or doctor.

PPO plans, or Preferred Provider Organizations, let you receive care from in and out-of-network providers for an additional fee. These plans do not require referrals when visiting specialists and allow you to play a more active role in your health care.

Depending on your needs, a Medicare Advantage HMO or PPO plan might be right for you.

How Medicare HMO vs. PPO Plans are Similar

Medicare HMO and PPO plans are available through Medicare Part C (Medicare Advantage) through private insurance companies. These companies provide your Medicare Part A and Part B benefits plus extra coverage, depending on the plan.

Both HMO and PPO Medicare Advantage plans use a provider network and some include prescription drug coverage through a Medicare Advantage Prescription Drug Plan (MAPD). Your carrier will determine your drug coverage. Furtrher, preferred pharmacies will vary based on your plan.

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How Medicare HMO vs. PPO Plans are Different


While HMO and PPO Medicare Advantage plans are similar, they also have subtle differences. While both plans use provider networks, PPO plan networks tend to be larger, and the plan extends coverage to providers outside of the network at a higher out-of-pocket rate. Meanwhile, HMO plans have smaller networks with zero coverage outside of the network unless deemed a medical emergency.

Usually, when you enroll in an HMO plan, you must choose a primary care provider who will work as a liaison for your care. This provider will refer you to specialists and ensure you receive the care you require.

However, PPO plans do not require a specific primary care provider and you will not need a referrals to visit a specialist on a PPO plan. This means you can receive care more conveniently and without a separate appointment for a referral.

Lastly, HMO plans tend to have lower maximum out-of-pocket limits. Keep this in mind when choosing the right coverage for your needs. It is helpful to review the pros and cons of each option in terms of your healthcare and budget requirements.

Which is Better – Medicare Advantage HMO vs. PPO?

Medicare Advantage PPO plans offer more freedom regarding your care. Additionally, you will need to play a more active role in coordinating your care while on a PPO plan.

This is due to the absence of a specific primary care doctor, plus having access to doctors outside of your network. Yet, when you need care outside of your network, options are available to you through a PPO plan, but not on an HMO.

To determine which plan will fit your needs, you will need to reflect on your specific coverage requirements. For some, an HMO plan may not be a viable option due to a need to receive care in another state. For the care others require, HMO plans may work just fine. The best option for you might not be someone else’s best option.

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How to Decide Between Medicare PPO vs. HMO Plans

If you are still on the fence about Medicare Advantage HMO and PPO plans, it is essential to review the pros and cons of each of your options based on your needs with a licensed professional. At Medicare FAQ, we help our clients determine the best plan for their needs regardless of the carrier.

To receive your free, no-obligation plan comparison of Medicare HMO vs. PPO plans, complete our online rate form or call the number above to get in contact with a licensed Medicare agent today!

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  1. Preferred Provider Organization, Medicare. Accessed November 2022.
  2. Health Maintenance Organization, Medicare. Accessed November 2022.

Jagger Esch

Jagger Esch is the Medicare expert for MedicareFAQ and the founder, president, and CEO of Elite Insurance Partners and Since the inception of his first company in 2012, he has been dedicated to helping those eligible for Medicare by providing them with resources to educate themselves on all their Medicare options. He is featured in many publications as well as writes regularly for other expert columns regarding Medicare.


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