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HMO
What is HMO?
The HMO (Health Maintenance Organizations) arranges for care for their beneficiaries either directly in its own group practice and/or through doctors and other health care professionals that have contract with HMO. When one joins an HMO, he/she pay a fixed monthly fee, called a premium. In return, the health insurance company and its health care network provide a variety of medical benefits. The range of health care services covered by an HMO varies, so it is important to compare available plans. Some health care services, such as outpatient mental health care, are often only covered on a limited basis. Visit www.healthinsuranceindepth.com for more information.
HMO’s advantages to employees:
According to Livingamerican.com, following are the benefits to employees for having HMO.
Ø In most cases, premiums are lower than other health plans such as PPO and POS plans. Some HMO providers require small co-payment for each office visit, such as $5 for a doctor's visit or $25 for hospital emergency room treatment
Ø Since HMOs receive a fixed fee for beneficiary’s covered medical care, it is in their interest to make sure that the beneficiary get basic health care for problems before they become serious. Beneficiary gets good coverage for "preventive care" (such as annual check-ups, flu shots, and hearing tests) that helps to keep the beneficiary well.
Ø Members generally just carry a card and do not have to worry about paperwork such as submitting bills
HMO’s disadvantages
to employees:
Some of the major disadvantages of having HMO are that the “beneficiaries often have to wait longer for an appointment than they would with a fee-for-service plan. Therefore, for a simple illness such as cough or cold, that is most likely to go away with over the counter medicine in 2-3 days, one would not wait few days to see his/her HMO doctor. In addition, HMO use gatekeepers, which means beneficiaries usually cannot see a specialist without a referral from their primary care doctor who is expected to manage the care they receive”. Visit www.INC.com for more information.
Few other disadvantages are listed below as described by Livingamerican.com.
Ø Beneficiaries have limited number of providers to choose for their care on the HMO providers list.
Ø Physicians in an HMO network may be salaried physicians, employed by the HMO, which means they are likely to think about best interest of HMO more than patients’ preferences. Many patients have filed lawsuits accusing certain HMO's of short-changing patient care in the name of cost containment.
Ø Beneficiaries are limited in their choice of hospitals - if a hospital is not part of the HMO network, they will have to bear the full cost if they are admitted there.
Cost and benefits to
employers for offering HMO:
It is in the best
interest of businesses to offer employee benefits and keep the cost of benefits
low. By offering employee benefits they are keeping hardworking employees, and
they can keep good public relations reputation. In addition, out of the
different manage care options available; HMO premiums are less expensive for
employers. However, one of the biggest disadvantages of offering HMO is premium
cost increase over time. average
cost per employee per year for an HMO plan rose 9.6 percent to $3,713 per year,
which is more than PPO’s premimum increase (INC.com). Employers will need to
consider all issues before making a decision on what to put in employee
benefits package. One of the strategy is to offer fixed amount of premium
toward employee’s health package and let the employer choose their own health
plan.
Changes in HMO:
"Open HMOs" (also called "Wrap around HMOs" or "Point of Service" POS Plans) are now providing some coverage with co-pays for non-emergent services by providers outside the network without a referral. As HMOs continue to evolve, the advantages and disadvantages of tomorrow's HMOs might be different than those of today's HMOs.
The premiums of HMO are rising because of fast changes in technology in medical field. Therefore, HMO providers are raising the premiums for employers and employees. The issue has caused stir in employers and unions workers. Many lawsuits are also filed against HMO’s and employers for denying some health coverage.
Due to the new law passed by congress in March, Medicare HMO drugs are cheaper. That’s because the new prescription drug coverage went only to seniors who join Medicare health maintenance organizations. Those organizations are private health plans that receive fixed payments from the federal government for each Medicare participant. However, according to a survey, Medicare pays HMOs more per beneficiary than it pays doctors, hospitals and others who provide care through traditional Medicare. Read this article on http://www.detnews.com.
Questions to Ask About an HMO:
According to www.healthinsuranceindepth.com, employees should evaluate their wants
and needs in order to determine the best health plan for plan for themselves.
To do so, employees should use the list of questions below as a guide. If, for
any reason, the policy does not answer any question to their satisfaction or
the company's information on health maintenance organizations is lacking, be
hesitant about purchasing it.
• How many doctors can I choose from?
• Is the network made up of private or group practice physicians?
• Which doctors are accepting new patients?
• Can I change my primary care physician?
• What is the procedure for referrals to specialists?
• How easy is it to get an appointment?
• How far in advance must routine visits be scheduled?
• What arrangements are there for handling emergency care?
• What health care services are offered?
• Are there limits to medical tests, surgery, or other services?
• What happens if a special service is needed but not covered?
• Where are the hospitals that serve you located?
• What happens if you're out of town and need medical attention?
• What is the yearly total for monthly premiums?
• Are there any co-payments? For which services and how much?
Lee, Mie-Lee. “What are the pros and cons
of offering my employees an HMO vs. PPO health
plan?” May 2001. INC.com. April 7, 2004. www.INC.com.
“HMO’s in the U.S”. April 7, 2004. http://www.vidaamericana.com/english/hmo.html
“How to Choose an HMO That's
Right for you”. April 7, 2004. www.healthinsuranceindepth.com
Wheeler, Larry . “Analysis:
Medicare HMO drugs cheaper”. April 2004.