HMO vs. PPO vs. HMO-POS vs. PFFS

What does a bowl of alphabet soup, crossword puzzles and the eye chart at the eye doctor’s office have in common with your insurance plan?

They all require you to recognize a group of letters that look unimportant or hard to understand at first. In the Medicare world, there are a few important acronyms that you may not recognize, namely HMO, POS, PPO and PFFS. Thankfully, it’s not rocket science and the doctor won’t say you need glasses if you don’t get them right. But what do they mean? It’s pretty simple once you understand a few basic terms.

HMO, PPO, POS and PFFS

First, all these letters represent types of Medicare Advantage plans. Medicare Advantage (Part C) includes all the benefits of Original Medicare (Parts A and B) but is approved and distributed by private insurers. MA plans provide the option for you to potentially have an all-in-one plan. They not only have the benefits of Part A and B but also may provide extra benefits.

Now, let’s explore what each acronym means and what the main differences are for your Medicare plan.

HMO = Health Maintenance Organization

An HMO is a health care plan that, in most cases, will require you to select a primary care doctor. Generally, you’ll need to get a referral to go see a specialist doctor with an HMO plan. Also, you’re typically not covered for medical services outside of the plan’s network of Medicare providers. If you don’t follow the rules for services, you may have to pay the full costs of care. The rules of an HMO health policy may be relatively restrictive compared to other plans, but HMO plans typically come at a lower cost.

PPO = Preferred Provider Organization

With a PPO plan, you can generally go to any doctor or hospital, but you will pay less if you use doctors and hospitals that are within the plan’s network. PPO health plans typically don’t require a referral for care by a specialist. If you decide to use an out-of-network health care provider or specialist, you may have to pay more for covered services. PPO plans are usually less restrictive than HMO plans. However, the monthly premiums for PPO plans tend to be higher.

PFFS = Private Fee for Service

PFFS plans don’t make you choose a primary care doctor and referrals are typically not required for specialists. But not all Medicare providers accept PFFS. For instance, in 2011, changes to Medicare law required many PFFS plans to have networks of providers. So, if you want a PFFS plan, make sure you understand which providers you can go to and the legal requirements for those visits.

HMO POS = Health Maintenance Organization Point of Service

An HMO Point-of-Service plan is a variation of the HMO plan. It is also less common than the standard HMO plan. Unlike HMOs, HMO Point-of-Service plans usually allow you to go to an out-of-network provider — at a higher cost to you. This makes the HMO POS act like a PPO plan.

If all these letters are still making you squint your eyes in confusion, we have licensed agents ready to help! Don’t let Medicare enrollment overwhelm you — the licensed insurance agents at PlanEnroll can help!

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