Are you having trouble deciding which type of health insurance plan best fits your health care needs?
If you are, you are not alone.
According to a recent Oxford Academic Group study published by CNBC, 61% of covered Americans have the wrong health care plan for their personal situation. In their article, It’s Not Just You: Picking a Health Insurance Plan Is Really Hard, The New York Times cites a lack of guidance as the primary reason for this statistic.
Here at Combined, our team of benefits specialists can provide you with the guidance you need to avoid becoming a part of this 61%. Instead, we want to help you find and enroll in the health insurance plan that is right for you.
In this article, we will discuss Health Maintenance Organization (HMO) plans and 6 personal factors to evaluate when considering HMO coverage. By reading it, you will learn whether (or not) an HMO is the right health insurance plan for you.
Key features of HMO insurance plans
To understand HMO insurance plans, you need to know a few fundamental terms:
- Premium – the amount you pay each month for coverage
- Copayment – the fixed amount, assigned as part of your specific coverage plan, that you pay for appointments and prescriptions
- Network – the select group of approved health care providers you can receive covered care from under an HMO plan
- Primary Care Physician (PCP) – the designated health care professional who provides you with general care and coordinates any specialized or advanced treatment you need
- Referral – the written authorization from your PCP permitting you to receive covered care from an in-network specialist
Now that you talk the talk, let’s walk through the key features of HMO insurance plans:
When you enroll in health care coverage through an HMO, you agree to pay a monthly premium.
Paying your premium gives you access to a network of covered provider options. From this network, you will select a primary care physician (PCP) who will oversee and coordinate all non-emergency aspects of your health care.
If you need general care, you will visit your PCP. If you need advanced care, you will first visit your PCP, your PCP will give you a referral to see an in-network specialist, and then you will be able to visit the referred specialist.
And, every time you receive health care – whether it be a visit to your PCP, an appointment with a specialist, or a transaction with the pharmacist – you will owe a small copayment.
Together, these key features of HMO insurance plans model an organized and effective health care system.
But is an HMO the right insurance plan for you?
6 factors to consider when choosing an HMO insurance plan
Think about the pharmacy aisle in your local drug store – even choosing between different types of pain relief medication is a personal and calculated decision.
Do you go with Tylenol or generic brand Acetaminophen? Or is Advil vs. Ibuprofen a better option? What about Aspirin? Aleve? Excedrin?
With so many options available, how do you make a decision?
Even with a decision as minor as which over-the-counter analgesic to purchase, you likely account for a variety of factors. For instance – How much does each cost? What are the potential side effects associated with each? How often can you take the recommended dose of each?
When selecting your health care coverage, there are just as many options to choose from.
So, making the major decision to enroll in an HMO insurance plan requires the same weighted consideration – it requires you to account for a variety of personal factors.
Here are 6 personal factors to evaluate when selecting an HMO as your health insurance plan.
1. Cost – What is your budget?
Purchasing health insurance has a price tag – this price tag depends on the type of plan you choose. So, the cost of different plans and how this expense fits into your budget is a critical consideration.
HMO plans are notably the most affordable type of health care coverage.
Compared to other insurance types, HMO plans are more affordable because they typically have low premium rates and low copayment amounts without having a deductible or coinsurance rate.
If containing the cost of coverage when budgeting for health insurance is your main priority, an HMO plan may be the right option for you.
2. Flexibility – How many provider options do you want?
HMO coverage is like a basic TV subscription.
When you purchase a bottom-tier TV subscription, you have access to a very limited number of channels. There are other channels available outside of your plan, but your access to them is restricted unless you are willing to pay an additional fee.
If you purchase insurance through an HMO, you will only have access to a select network of health care providers. While there are available out-of-network providers, your coverage is restricted to those within the HMO’s network. If you want to access out-of-network care, you have to pay the full out-of-pocket price.
Are you comfortable having your health care coverage limited to a provider network? If so, an HMO plan may be the right option for you.
3. Preference – Do you have a preferred provider?
Is there a particular provider that you need to see for either general or specialized care?
If there is, to receive coverage under an HMO insurance plan, they must be in-network.
Given you do not have a provider preference or your preferred provider is part of your HMO’s network, an HMO plan may be the right health care option for you.
4. Location – Where do you live?
The provider network under an HMO insurance plan is specific to a geographic location. In other words, where you live plays a part in how many in-network providers your plan will give you access to.
Take a guess - Would you have a larger network of providers living in a big city or a remote town? Due to the relative number of providers alone, the network for an HMO is typically larger in urban areas than in rural ones.
This example shows that when considering HMO coverage, you want to be sure that you live in an area with an adequate amount of in-network health care providers. If you do, an HMO plan may be the right health care option for you.
5. Lifestyle – Do you travel often?
Since an HMO’s network of providers is location-specific, traveling outside of your network’s location leaves you without health care coverage and increases your risk of paying for care out of pocket.
So, when considering an HMO insurance plan, keep in mind how often you travel.
If globe-trotting is not your norm, an HMO plan may be the right health care option for you.
6. Necessities – What health care services do you need?
Because HMO coverage is limited to a select network of providers, it is important to consider how comprehensive your plan’s network is.
Why? To be sure your HMO’s network offers covered access to any specialized services you need or expect to need.
For example – If you plan to start a family, access to in-network maternity care should be a consideration.
Can your HMO plan meet your necessary health care requirements? If it can, an HMO plan may be the right option for you.
Take the next steps – Find the right health insurance plan for you
If you are here, you are weighing your health insurance plan options – you want to enroll in the coverage best suited to meet your personal needs.
In this article, we explored HMO insurance plans and you learned 6 personal factors to evaluate when considering HMO health care coverage.
Here at Combined, this critical decision is one that our skilled benefits team is well-versed in. We want to assist you with any and all questions you have so that you won’t have to question the coverage decision you make.
This article is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice.
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