Insurance form

Sorting Out Insurance: PPO’s vs. HMO’s

Insurance is a wonderful thing to have as it helps us get the medical attention we need, but trying to understand the ins and outs of Insurance can be a bit frustrating. Below are some basic facts and terminology as well as questions to ask your insurance provider when trying to figure out if a medical procedure or therapy is covered.

What is the difference between a PPO and an HMO?

–A PPO allows the individual or family covered under the plan to go anywhere they want for treatment/services.

–An HMO has a list of providers they are contracted with for services, so you must choose from the list if you want services to be paid for by the insurance.

I have an HMO, what is the next step once a specialist or facility is found?

Once you select a specialist or a facility, you will need a “Referral” from your Primary Care Physician (PCP).  This is created by your PCP office and sent to the HMO for approval and authorization.

–When you contact your PCP, ask for a “referral coordinator”…this person will be the most helpful.

–If there is not a “referral coordinator” on staff, make sure to tell the nurse or receptionist you need a “Referral for the HMO”.

My PCP gave me a Referral, how do I know if it is correct?

–This is where things can get tricky!  Sometimes a PCP will write a Referral for services, but it is not approved by the HMO.  To tell if it is correct, look for an “authorization #” and an “approval to and from date”.  There may also be a specific number of visits that are approved.

  • Here are some basic terms and what they mean:

1) Deductible (DED):  This is what you must pay or “meet” before the insurance will start to pay their portion.  Sometimes there is an Individual DED and sometimes a Family DED.  Ask the insurance if you need to meet one or both of them before they will pay for services.

2) 80/20, 90/10, etc:  This refers to the percentages that the insurance will pay and the responsible party will pay.  The first number is the insurance’s part!

3) Copays:  This is what the responsible party pays for each visit.

4) Pre-authorization:  This may be required prior to starting services.  A reference or case number is usually given to track the review process by the insurance company.  You may also need authorization after a specific number of visits to continue therapy.

5) Visit limit (max # of visits):  These are usually seen when therapy is involved.  There are some policies that have no limit, so you can be seen as many times as needed, as long as there is a medical necessity.  Also, just because you may be given a visit number, it does not mean you are guaranteed all of them. The insurance may review your case and determine the therapy is not medically necessary anymore.

a) Hard Max:  This is the number of visits allowed by the insurance company during the policy year.  Unfortunately, there is no way to get more visits if you run out.

b) Soft Max:  If you should need more than the allotted amount, you are able to have the insurance review the case to see if more visits can be given.