What is the difference between HMO and PPO plans?

HMO and PPO plans are two common types of health insurance plans with key differences. HMO, or Health Maintenance Organization, offers a network of healthcare providers that members must use for coverage. A primary care physician (PCP) serves as a gatekeeper for all referrals and specialists. HMO plans generally have lower out-of-pocket costs and may require co-pays for each office visit. On the other hand, PPO, or Preferred Provider Organization, offers more flexibility by allowing members to visit any healthcare provider, with or without referrals. PPO plans have higher out-of-pocket costs, including deductibles and co-insurance, but often offer broader coverage and access to specialists without prior authorization. Ultimately, the choice between HMO and PPO plans depends on an individual's healthcare needs, budget, and preferred level of provider choice and convenience.