For individuals or families searching for health insurance for the first time, choosing whether an HMO or PPO plan is best can be a confusing and somewhat difficult process; but it does not have to be.

            For the average family, typically HMOs are the ideal health plan, offering lower costs for medical care.  With no deductibles, an HMO or Health Maintenance Organization, families experience lower out-of-pocket costs and small co-payments (the flat fee charged for a covered service) for each doctor’s visit.  With an HMO, families have less flexibility when selecting physicians and hospitals because those physicians must be within their network, a group of healthcare providers contracted by an insurance company to provide services at a discounted rate.  Although this may seem an inconvenience, HMOs are ideal for those families who will need annual visits to the doctor, OB/GYN care, and maternity care, while experiencing lower costs.  Families must choose a primary care physician within the network who will provide them with specific benefits.  Families will most likely need a referral to see other specialists but with fewer billing hassles and overall lower costs, an HMO is generally the best fit for the average family when looking for health insurance.

            While an HMO is ideal for many families, a PPO or Preferred Provider Organization may be better for a person suffering a chronic condition or seeking various types of medical attention.  A Preferred Provider Organization includes a managed care arrangement which is a group of hospitals, physicians, and other providers who have contracts with insurers to provide health insurance services to enrollees at predetermined rates.  This managed care arrangement allows members to see physicians and hospitals out of the company’s network.  This is a benefit for those people looking for different medical attention such as chiropractor visits, but these visits require higher out-of-pocket costs.  With a PPO, people experience higher deductibles and they must satisfy the deductible before benefits are paid.  Members who choose a PPO plan still pay a co-payment for office visits but the benefit is the flexibility and personal choice of any doctor in the network.  Patients under a PPO plan typically have higher deductibles and costs, but they cannot be billed for fees in excess of what the insurance company allows which is a plus for those people seeking separate medical attention.