Medicare HMO vs. PPO
Many times, people don’t realize the importance of health care until they fall ill. But finding the right health care coverage should be a priority for everyone. That’s because it doesn’t just come to your rescue in emergencies—it gives you peace of mind.
Medicare is a type of government health care coverage for people age 65 and older. While there are several Medicare options, the most popular are:
- Original Medicare
- Health Maintenance Organization (HMO)
- Preferred Provider Organization (PPO)
While both Medicare HMO and PPO typically have more similarities than differences, the main contrast comes down to premiums or higher costs in
When choosing a Medicare plan that is best for you or your loved ones, you may want to consult a plan representative to better understand the advantages of each plan.
Comparing Original Medicare, HMO and PPO
| Original Medicare | Medicare HMO | Medicare PPO |
|---|---|---|
| Gives you the advantage of consulting any health care provider and using any health care facility that accepts Medicare plans*. | Allows you to only consult providers in the network**. | Allows you to consult any health care provider, but you typically need to pay more when seeing the out-of-network providers. |
| Allows you to visit doctors anywhere in the U.S. | Allows you to only visit doctors in your plan’s service area, except in emergencies or when urgent care is needed. | Allows you to visit doctors anywhere in the U.S., but you typically need to pay more when seeing out-of-network providers. |
| You do not need to have referrals to see specialists. | You typically need referrals to see specialists. | You do not need to have referrals to see specialists. |
| Does not cover hearing, dental or vision services. | May cover additional services, including hearing, dental and vision. However, additional benefits may increase your premium costs or other out-of-pocket expenses. | May cover additional services, including hearing, dental and vision. However, additional benefits may increase your premium costs or other out-of-pocket expenses. |
| Allows you to sign up for a stand-alone prescription drug plan. | Provides prescription drug coverage in most cases. However, you may be needed to pay a higher premium. | Provides prescription drug coverage in most cases. However, you may be needed to pay a higher premium. |
| No out-of-pocket limit. | Annual out-of-pocket limit for in-network care (maximum is $7,550 in 2021). | Annual out-of-pocket limit for in-network care and combined in-network and out-of-network care (varies by plan). |
*Health-care providers are classified as participating and nonparticipating providers. Participating providers accept Medicare’s approved amount for health care services as full payment. Non-participating providers accept Medicare insurance, but they do not accept Medicare’s approved amount for health care services as full payment.
**A network is a group of doctors, hospitals and medical facilities that signs a contract with a plan to provide services.
What is Medigap?
With Original Medicare, you also have the option of purchasing a supplemental insurance policy or Medigap.
Medigap is a health insurance policy that offers standardized benefits to work with Original Medicare. Medigap plans charge an additional premium to cover Medicare cost-sharing and other benefits.