The differences between Medicare Supplements vs HMO vs PPO are easy to understand. But, more complex is the difference between PPO and Medigap.
HMO and PPO both have a network with lower costs when you follow the rules. Imagine a plan that gives you total doctor freedom and consistent coverage; well, that is the Medigap option.
The HMO network is very narrow, while the PPO network is broader. Yet, there may be more advantages to having a Medicare Supplement plan.
The only way to choose is by studying the ins and outs of these options. Lucky for you, we have all the details below!
Differences Between Medicare Supplements vs HMO vs PPO
There are several different forms of Medicare Advantage plans that are available to Medicare beneficiaries. Two out of four programs are the most popular; the Health Maintenance Organization (HMO) and Preferred Provider Organization (PPO) plans.
Approximately 34% of beneficiaries have an HMO or PPO plan. Below we will review what the difference is between the two. Then, we’ll compare the differences between HMO, PPO, and Medigap.
What are the Biggest Differences Between PPO and HMO
There are significant differences between a Health Maintenance Organization (HMO) and a Preferred Provider Organization (PPO). For most Medicare patients, the cost is a huge factor in health insurance.
Let’s face it; we all must live within a specific, personal budget, and insurance plans can equate to significant spending.
You can expect to see different monthly premiums, out of pocket costs, as well as options in providers and facilities. Another difference between these two options is the sizes of the networks.
HMOs are plans where beneficiaries go to doctors, hospitals, and other doctors that are in-network. The network exception is in an emergency or urgent circumstances.
There may be instances where a beneficiary seeks care out-of-network for services; they will pay more.
When you initially enroll in an HMO plan, you’ll need to select a doctor. If you need to see a specialist at any time, your doctor will refer you.
Prescription medications have coverage under HMO plans in most cases. These are Medicare Advantage Prescription Drug Plans (MAPD).
When using an HMO plan, you agree to receive health coverage in-network with your specific policy. That’s not saying you can’t get care outside of the network; but, you could pay a lot out of pocket.
PPO plans are another option for individuals who love the flexibility that this plan could offer. Preferred Provider Organization plans don’t require referrals to see specialists or primary care doctor visits.
You’ll still want to use providers and facilities that are in-network with your insurance. If you choose to use any out-of-network providers or facilities, you could face higher co-payments and coinsurance prices.
You can still receive Medicare prescription drug coverage with your PPO plan. To do this, you would enroll in an MAPD plan.
Not all PPOs are the same, so not every program may include Part D. Benefits and costs vary from plan to plan.
HMO Vs. PPO
An HMO varies from a PPO in many ways. When using an HMO plan, you’ll have to first visit with your doctor if you need to see a specialist.
Your doctor will have to provide a referral to a specialist for insurance to cover your visit. With a PPO, you don’t have to visit your doctor before seeing a specialist, and a reference isn’t necessary.
HMO plans usually offer lower monthly premiums and tend to have less out of pocket costs associated with it. The flexibility of a PPO plan often results in higher monthly premiums as well as higher out of pocket costs.
HMO vs. Medicare Supplements
We’ll start by addressing the details of Medicare supplements. Medicare covers some health costs and Supplements help cover the remainder.
An HMO plan can seemingly offer a lot more benefits for a lower premium than Medicare and Medigap. But, HMO plans can end up being more hassle than it’s worth to “save”.
Have you ever needed a certain specialist and had difficulty finding one that takes your insurance near you? That’s the kind of issue you could have with an advantage plan.
If you have a list of doctor preferences, a Medigap plan is more suitable.
PPO vs. Medicare Supplements
The difference between a PPO and Medigap is that a PPO can cover less than Medicare outside the network. Whereas, a Medigap plan allows you to see any Medicare doctor.
Supplement plans are private insurance policies that help cover a beneficiary’s coinsurances, deductibles, and copays. While people may end up paying more monthly for Medigap, they’re likely to have lower costs overall.
If you shop for doctors out of Medicare’s network, likely, your insurance won’t cover costs.
Understanding the Difference Between Medigap vs HMO vs PPO
As a beneficiary, you may be asking yourself which plan is best for you and your needs. Paying a lower premium may be appealing; but, you may decide that a lower deductible works better in the long run.
There are several things that you should consider when making this decision. Review your current income and potential income down the road.
In addition to income changes, you may face an influx of health changes with age. Look into plans that are available and discuss all the health possibilities.
The slightest change to your daily life could have an impact on you; so, it’s imperative to prepare. Preparation for life changes should include shopping for the best health plans.
If you gear yourself with the right tools, you could save yourself money and time. Call us today at the number above to discover the best options for you.
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