Comparison Between HMO And PPO

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Register to read the introduction… Plan members must select a primary care practitioner which could be a physician, physician assistant or a nurse practitioner. The primary care is responsible for coordinating health delivery for plan members. Receiving care by a specialist physician will require a referral from the primary care provider (PCP.) This cost containment strategy is intended to avoid service being duplicated by the PCP and the specialist. (www.amjc.com)

The similarities of both the HMO’s and PPO plans is that both plans require authorization, prior approval or pre-certification for many elective hospital admissions, tests which can be costly surgeries and procedures. Through the use of managed care, HMOs and PPOs are able to reduce the costs of hospitals and physicians. Managed care is a set of incentives and disincentives for physicians to limit what the HMOs and PPOs consider unnecessary tests and procedures. Managed care generally requires the consent of a primary-care physician before a patient can see a specialist.
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This unique relationship often allows HMOs to maintain a lower cost of service from plan providers. Because the HMO is both a provider and an insurer, this allows for lower administrative cost to the patient. Preventive care is offered through HMO’s, this is a way they try to reduce cost, through early detection and wellness programs. Thus, inexpensive visits to the primary care physician the chance for early detection of costly diseases can be preventative. HMOs also try to reduce costs by providing preventive care. Because visits to primary-care physicians are inexpensive for patients, the chance of early detection and care increases. …show more content…
( Kongstvedt 2007) The out-of-pocket maximum, deductible, and coinsurance will each affect the cost of the PPO insurance coverage. A plan member can help to lower his/her premiums by having as high deductible as the plan member can afford to pay out of pocket. (www.ajmc.com). As of 2010 the majority of private and public payers have committed themselves to having their provider payments incorporate both quality of care and efficiency. (www.ajmc.com) In the United States, according to the article written in PubMed, “a number of communities are adopting a managed care approach to caring for the low-income and uninsured individuals”. These communities have a system that is studying their health and tracking their wellness programs of those communities. This will greatly improve and create a design to help ensure access to primary and preventative care for the low-income group. (Felland & Lesser

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