Three types of Medicare Advantage plans: Which one’s right for me?

Learn about the coverage, network and managed care in HMO, HMO-POS and PPO plans

When I talk to family and friends shopping for a Medicare Advantage plan, they often ask me what those letters mean at the end of the plan name. You’ve probably seen them too – HMO, HMO-POS, or PPO.

We can simplify that for you! There are different types of Medicare Advantage plans. The main differences between these types of plans is the coverage, the network, and how the plan manages care. Here are the three most common types of Medicare Advantage plans:

Health Maintenance Organization (HMO): This plan type is generally the most restrictive of the Medicare Advantage plan types. The plan only covers health care from doctors, clinics or hospitals in the network. It doesn’t have out-of-network benefits. So you need to be comfortable getting all your care within the plan’s network. You may be required to choose a primary care clinic (PCC) to manage all your care. Your PCC takes care of referrals if you need a specialist and works with your health plan to get approval for specific care.

Health Maintenance Organization Point-of-Service (HMO-POS): The plan works like an HMO except you’ll have coverage for some out-of-network care. For example, you could get all your primary care from a doctor in the network (that’s the HMO part). Then you may choose to see a specialist not in the network and pay the extra cost-sharing (that’s the POS part). Always check your Evidence of Coverage document because health plans may limit POS coverage to certain services, areas and/or providers.

Preferred Provider Organization (PPO): PPO plans are more flexible with network and referrals than HMO plans. The plan has a network, and you’ll pay less when you use those providers. You can also get coverage for all covered services out of network (not limited to certain services), but you’ll likely pay more for those services. You don’t need to choose a PCC or get a referral to see a specialist.

At-a-glance: How different types of Medicare Advantage plans work

CoverageHMOHMO-POSPPO
Provides Medicare Part A and B benefits for hospital stays, doctor visits, outpatient care and suppliesYesYesYes
Covers some of the Medicare copays, coinsurance or deductiblesYesYesYes
May include outpatient prescription medicine, known as Part D coverageYesYesYes
May include extra benefits (examples: gym membership, eye and ear exams or a U.S. travel benefit)YesYesYes
May include dental coverage, or you may be able to add dental coverageYesYesYes
Networks
Has a network of doctors, clinics and hospitals that agree to offer services at lower ratesYesYesYes
Covers health care services you get out of network, but you’ll likely pay more. (Note: All plans cover these services as in-network benefit even if received out of network in the U.S.: emergency care, urgent care and renal dialysis)NoYes, but may be limited to certain services, geographical areas and/or providersYes, applies to all plan covered services
Managed Care
Choose a primary care clinic to coordinate your health careUsuallyUsuallyNot common
Referral needed to see a specialistUsuallyUsually for certain services received in networkMaybe for certain services received in network
Prior authorization needed for certain health care servicesUsuallyUsually for certain services received in networkMaybe for certain services received in network

Always check the network list when choosing a plan

Since HMO, HMO-POS and PPO plans all have networks, it’s important to make sure your doctor or hospital is part of that network before you get health care. Here are convenient ways to check if your provider is in a plan’s network:

  • Search the plan’s online provider directory. Usually, you can search for a doctor, clinic, urgent care or hospital by name, specialty or condition. Or you may be able to enter your ZIP code or city for nearby care.
  • If you need care in a hospital, check that both the doctor and the hospital are in network. Many doctors practice at multiple hospitals so you’ll probably be able to find an in-network hospital to get care from the doctor of your choice.
  • Talk to the health plan’s sales representatives about the network options before you choose a plan, or talk to the plan’s member services representative after you’ve enrolled in a plan.

Need more help? Check out these resources:

The State Health Insurance Assistance Program offers free, independent counseling services and local workshops to help with your health care benefit decisions.

Visit medicare.gov, or talk to a Medicare expert, like an agent, broker or health plan sales rep.

 

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