HMO VS PPO: Which is best for you

Although HMOs and PPOs are both considered to be service providers, they differ in many respects:

• HMOs require members to choose a primary care physician (PCP) to authorize and coordinate the member’s medical needs and are limited to a much smaller geographical area in which to choose from available HMO providers
• PPO insurers do not require a PCP and provide a larger network of physicians and hospitals, usually encompassing providers within several states, or throughout the country
• HMOs pay a fixed monthly capitation fee per member to medical providers in exchange for services rendered to HMO members, regardless of the amount of services rendered
• PPO insurers pay a fee-for-service to medical providers for actual services rendered, in comparison to a fixed capitation fee
• HMOs are highly regulated by both the states and federal government
• PPO insurers are less stringently regulated by the government