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What Is Health Maintenance Organization (HMO)?

Health Maintenance Organization (HMO) is the types of Managed Care Plans. Its offers its customers low co-payments, minimal paperwork, and coverage for much preventive care and health improvement programs When you join, instead of paying for each individual service that you receive, you pay a set monthly or quarterly premium. In return, HMOs offer you a range of health benefits.

HMOs consist of a network of physicians. You choose a primary care physician (PCP), who is responsible for your health care as well as for making referrals to specialists.

HMO will require that you seek care within its network of providers ­ doctors, hospitals, and labs, with whom your HMO has negotiated a fee schedule.

Advantages of Health Maintenance Organization (HMO)

  • Do not require claim forms for office visits or hospital stays.
  • HMO members present a card provided by the company.

Disadvantages of Health Maintenance Organization (HMO) 

  • The drawback of any HMO policy is that care received outside of the health care network is not covered.
  • In an HMO you may have to wait longer for an appointment than you would with an indemnity insurance plan. It is difficult to get specialized care.
  • You are responsible for paying the entire medical bill.


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