Medicare HMO: Health Maintenance Organization

Health Maintenance Organizations (HMO's) were introduced into the Medicare System along with a variety of other plans as an alternative to Original Medicare. All of these plans are also sometimes called Medicare Advantage Plans or Medicare Part C.

What is an HMO?

HMO's are offered by a variety of private insurance companies throughout the Unites States. An HMO Plan revolves around a select group of providers that are contracted with the plan. These will include doctors, hospitals, nursing home facilities and pharmacies. The patient is also given a primary care physician. The idea behind these plans is that the primary care doctors and patients develop a close relationship with one another. It is the doctor's job to monitor the health of the patient and provide early diagnosis for medical issues. The primary care doctor then refers the patient on to a specialist within the plan's network if one is needed.

Specifics Things to know about Medicare HMO Plans

HMO Plans control costs by using the Plan Network. Patients are not generally covered if they seek care or supplies outside the network. From the patient's standpoint this can be limiting. However, the network's restrictions also keep costs down. Patients benefit from these lowered costs and pay lower co-payments.

In addition, HMO Medicare patients are generally required to get a referral from their primary physician to see a specialist. Sometimes this seems silly. Patients generally know when they need to see a specialist and often find the extra visit to a primary physician a hassle. However, this extra step ensures that the primary doctor knows about all the care a patient is receiving. He/she can make sure that overlapping procedures are not dangerous. This extra step actually saves both money and lives and that is why it is such a widely used practice among HMO plans.

The second most notable restriction on Medicare HMO Plans is that they are location specific. This means that if a patient needs to see a provider while out of town and the visit isn't an emergency, the insurance company is not obligated to pay for care.