By: Megan Henney
Every year, Americans have a limited timeframe to select a health care plan for the year ahead.
This year, open enrollment for 2021 coverage through the Affordable Care Act will start on Nov. 1 and run through Dec. 15 (although some states, including California and Colorado, have permanently extended their open enrollment periods).
Obtaining health insurance is likely to be a priority for most Americans this year, given the coronavirus pandemic. But figuring out the right plan for you can be tricky -- even for the experts.
Here's how to decide between two of the most popular types of plans, a health maintenance organization (HMOs) or a preferred provider organization (PPO).
Health maintenance organizations (HMOs): HMOs offer an entire network of doctors, hospitals and other health care providers who have agreed to accept payment at a certain level for services provided.
Individuals who select this plan must select from a network of local health providers. That doctor is who they will see when they need medical care. If that individual needs to see a specialist, they would first visit their primary care doctor for a referral, which means an extra office visit. The trade-off is that HMO plans tend to have lower premiums, as well as cheaper copays and coinsurance. Typically, this plan does not cover out-of-network care, except in case of emergency.
Preferred provider organizations (PPOs) A type of plan where individuals pay less if they use providers in the plan's network. You do not need referrals to see a specialist. If you see an in-network provider, you will only be responsible for a portion of the bill, depending on your plan's payment structure.
If you see a doctor who is out-of-network, you'll be on the hook for a larger portion of the bill, although most plans still cover a portion of the bill. Unlike an HMO, a PPO offers individuals more freedom in when and where they seek health care. But it comes at a higher cost -- plans typically include more expensive out-of-pocket costs, higher monthly premiums and pricier copays. There's also an annual deductible.
Unless you see a lot of specialists, a PPO plan could cost you more money over the course of a year.
Source: Fox Business https://www.foxbusiness.com/healthcare/picking-a-health-care-plan-how-to-decide-between-a-ppo-and-hmo