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Whether I’m working with a new client or I’m out and about networking and I share with people what it is that I do, oftentimes I get asked about the difference between HMOs and PPOs. And then there’s that new thing that they threw in there, the EPO, which is a hybrid of both.

I’d like to take this opportunity to focus more on the HMO vs PPO discussion with a sprinkle of EPO here and there. The way that I like to explain the difference between HMO and PPO is through a sports analogy. I think at some point, all of us have had a coach, whether it was because we needed a life coach, career coach, or we were in some sort of organized sport. We’ve pretty much had a coach right? Even in the space of our educational career, your advisor is still a coach if you’re a student in school. I like to use this analogy because it’s a framework that a lot of people are familiar with. Now applying this to HMO vs PPO, the difference between the two, with the HMO, your primary care doctor is going to be your coach. So you’re kind of the silent partner in that whole process. If you find that you have a health concern first you have to go to your primary doctor to get a diagnosis and figure out what the problem is. Once your doctor goes through their process to rule things out, they’ll point you in the direction of a specialist if needed. You can’t just go to a specialist, you have to get a referral.

Whereas with the PPO you can go to your primary, if you want to bring them in the loop/ask for their input, or you can skip over your primary and go straight to the specialist.  With a PPO, you’re the coach! You get to decide which one of these options is best for you – seeing a primary first and then the specialist, which takes time away from you getting closer to understanding what it is that you are experiencing, or choosing to go straight to the specialist.  If you have an understanding of whom the provider type is that can help you, if not, you may want to go to your primary first no matter which of the two insurance types you have.

Both for my family and when I’m working with clients, I prefer PPO for the reasons mentioned before and an added out of network benefit.  That’s the other difference between PPO and HMO. An example of how this works, if the primary or the person your provider refers you to isn’t in network, your insurance company has a provision to reimburse you a specified amount. You will have to go through a process to file necessary documents, but once you go through that, eventually you’ll get a payment for a specified amount that your insurance company agreed upon. HMOs don’t offer this benefit. With an HMO, you will incur an out of pocket cost if you go to someone out of network, and you will not get reimbursed. 

Here’s where I’ll sprinkle in the EPOs. The EPO is a hybrid of HMOs and PPOs in that like an HMO your doctor is the coach and refers you out, but like the PPO if you are referred outside of the insurance carriers network, there is an out of network benefit that you can take advantage of.  Even though this is offered, I would caution you to seriously delve into the fine print on these plans.  There could be certain tiers, or percentages that will be paid out only under certain circumstances.  There’s a lot that goes into the background of that, but that’s why it’s a hybrid, it’s pretty much an HMO with some level of PPO benefit. 

While my preference is for PPOs, HMOs can save you a lot of money.  If you are someone who sees your primary as your go to for medical information, or you like the docs in the network you’re in then an HMO option may meet the affordability and usability factors in your health insurance shopping.  On the other hand, if you’re somebody who doesn’t want to be beholden to just who your primary sends you to because also when it comes to that, or you want the options of seeing someone who isn’t in network, then consider a PPO.  It cost more on a monthly basis, but it also affords you certain freedoms you won’t experience with an HMO.  

We have experience with all three of these types of insurances.  When working with clients in their search for the right health insurance, we take the type of insurance, our clients budget, and our clients individual needs into account as we consider and make recommendations.  While you are more than capable of making these decisions on your own, you don’t have to.  Our team is here to help you.  Schedule a consultation so we can get to know you and your needs.