What is the difference between HMO and PPO plans?

HMO (Health Maintenance Organization) and PPO (Preferred Provider Organization) plans are two common types of healthcare coverage options. The main difference lies in the flexibility and cost considerations. HMO plans typically require members to choose a primary care physician (PCP) and obtain referrals for specialist visits. They usually provide a network of doctors and hospitals where members must seek care; otherwise, they may face out-of-pocket expenses. HMO plans generally have lower monthly premiums and predictable out-of-pocket costs. On the other hand, PPO plans allow members to visit any healthcare provider. They do not require referrals, offering greater flexibility but often at higher costs. PPO plans usually have higher monthly premiums and varying deductibles and co-pays. The choice between HMO and PPO ultimately depends on individual healthcare needs, preferences, and budget considerations.