All health insurance plans have a network of health providers that you can access. This is true whether you buy your coverage on the marketplace or get it through your employer. How you access that network — whether you can visit doctors, specialists, hospitals outside of it, for example — and how the costs are covered will depend on the type of plan you have.
PPO, HMO, EPO (exclusive provider organization), and POS (point of service) plans have different benefits and costs. Some of these plans provide more flexibility in which providers you can while see, while others might require you to get permission or pre-authorization from the insurance company before you can have a medical procedure.
This chart shows some key differences, which we’ll discuss in depth later on:
Feature | HMO | PPO | EPO | POS |
|---|---|---|---|---|
Primary care physician required | Yes | No referral | Usually | Yes |
Out-of-network coverage | Not covered* | Covered, but at a cost | Not covered* | Covered, but at higher cost |
Specialist visit | Referral only | No referral | No referral | Referral only |
Pre-authorization required | No | No | Typically | Typically |
Premium cost | Lower | Higher | Middling | Middling |
What type of health insurance plan should I get?
When deciding which type of health insurance plan to get you’ll need to consider some key factors, like how easy it is to access a doctor within your plan. HMOs, PPOs, EPOs, and POS plans are all different types of managed care plans — that simply means the insurance company tries to balance the cost and quality of care for its customers by contracting physicians to its network. Some types of health insurance plans will not cover your medical costs from out-of-network providers, while others may cover only some of the costs.
Maybe you already have a doctor that you like to see or a preferred hospital nearby. When you’re choosing a health plan, you should check to see if these providers are in your network. If they’re not, you should think about how much you’re willing to pay for out-of-network coverage.
Outside of Open Enrollment, you can buy a marketplace-health plan during Special Enrollment period after you experience a major life event.
Learn more about how health insurance works.
Emergency care
While some types of health insurance plans don’t offer out-of-network coverage, there is one exception: emergency care. Under the Affordable Care Act, also known as Obamacare, insurance companies can’t charge you more for getting emergency care services at an out-of-network provider. That’s because when you a medical emergency, you don’t have the time to check to see if the physician or emergency room you’re rushed to is in network.
Specialist coverage
How often you see specialists might also influence your decision. If you have a chronic illness and need to see a specialist physician, like a cardiologist, regularly, you’ll want to be able to make an appointment with them directly. Some types of health insurance plans will require you to see choose a primary care physician (also known as a primary care doctor) and see them first to get a referral. This could cause an extra inconvenience or cost (like a copay) depending on how your plan works.
Affordability
That leads us to another important factor: cost. When you get health insurance, you’ll have to pay a monthly premium just to access the plan. While certain types of plans have higher premiums — PPO plans, for example, generally have higher premiums than HMOs — the exact costs of your health plan will depend on the specific plan, the insurance provider, and your location. For example, the premium price of an HMO with one insurer might not be that much cheaper than PPO health insurance plans with a different company. Keep affordable health insurance in mind as we discuss each plan type.
Cost is represented on the health care exchange by "metal tiers", which range from Bronze to Platinum. The quality of care shouldn't be affected by buying a lower-tier plan, but you may have to pay more for the cost of your care.
It’s important to compare the costs of different plans from different insurers and what they offer. HMOs, PPOs, EPOs, and POS plans will differ on whether they include prescription drug coverage or a dental plan. Most types of plans, even the most basic ones, tend to cover preventive care services as well as the so-called ten essential health benefits.
If you’re getting insurance through your employer, you may have fewer options and only be limited to one type of plan — this is not necessarily a disadvantage. The health insurance marketplace, where you would buy the plan on your own, will offer many plans and multiple types, but the abundance of options may be overwhelming. Plans purchased on the marketplace will all have higher premiums than any group insurance plan offered through your workplace. (See your health insurance options.)
Learn more about who needs health insurance.
PPO (Preferred Provider Organization)
PPO plans are among the most common types of health insurance plans. This plan type lets you see any provider you want and you don't have to get a referral from a primary care doctor to see a specialist, like you would with other types of insurance plans (like an HMO, which we’ll discuss later).
Typically, PPO insurance covers medical services from out-of-network providers and in-network providers differently. That means while your insurance covers the costs of seeing a doctor that’s out of network, it won’t cover as much as when you see one that’s in network. Usually you’ll need to pay more in out-of-pocket expenses when you see an out-of-network provider.
For example: If you need to see a dermatologist you can schedule an appointment without a referral from your primary care physician. If the dermatologist does not take your insurance, you would typically need to pay the dermatologist in full for the services, then send a claim to your insurance company. They will reimburse you according to the terms of your plan — that might mean the amount that exceeds your copay or coinsurance.
Learn more about PPOs.
HMO (Health Maintenance Organization)
This plan type only allows you to see providers that are directly contracted to the plan. You'll have a primary care physician who coordinates your care and will refer you to in-network specialists.
The costs of seeing a doctor outside of your network will not be covered under HMO health insurance.
For example: Let’s say you have an HMO plan and want to see an orthopedist. For that to happen, your doctor must write you a referral to an orthopedist in your network. This specialist visit will be covered by your insurance. If you go to an orthopedist that is not in your HMO network, you'll pay the specialist's fees on your own, and your insurance provider will not reimburse you.
Learn more about HMOs.
EPO (Exclusive Provider Organization)
An EPO plan is less common than HMOs and PPOs, but shares features of both. Like PPO insurance, you can go directly to a specialist and bypass the need for a referral from your primary care physician. But, like HMO insurance, you're not covered if you see out-of-network providers — however, as mentioned, in the case of a medical emergency, EPO insurance will cover some of the costs of out-of-network expenses.
Learn more about EPOs.
POS (Point of Service Plan)
This plan type is a hybrid of the HMO and PPO plans. You'll have a primary care provider that can coordinate your care and you'll need referrals to see a specialist. While you can see out-of-network providers, you might have to pay for some or most of the costs of care. If you want to have a medical procedure, you may also need to ask your insurer for prior approval, or pre-authorization, first.
For any care you need that isn't covered by your health insurance plan, such as dental and vision coverage, you may need to purchase a supplemental health insurance plan.
