As your company’s benefits administrator, you’ve put a lot of thought into your benefit strategy and what plans to offer based on several factors: employee age, location, health status, plus your budget and compensation strategy. The majority of your employees probably prioritize access, so you default to offering a PPO (preferred provider organization) network that covers care nationwide — and maybe a high-deductible health plan (HDHP) for a few cost-conscious employees.
But, did you know that you can offer a plan that has lower overall costs without sacrificing access to care or making your employees pay for the full cost of each medical visit until reaching their deductible?
An HMO (health maintenance organization) plan Opens in a new window offers a personalized and coordinated approach to care and has a less expensive price tag compared to PPO plans — we’re talking 5 to 7 percent savings. Here’s what you need to know before integrating a local HMO plan into your benefit strategy.
What is an HMO network and how does it work?
An HMO network is a group of doctors, hospitals, pharmacies, labs, clinics, durable medical equipment vendors, imaging centers, and other health care providers who agree to provide medical care and services at a reduced rate.
HMO plans give your employees the opportunity to seek and coordinate care locally. Your employee's primary care provider (PCP) will become their centralized resource — their go-to — for health care information, directing them to specialists and other providers within the network as needed in addition to seeing them for routine check-ups, physicals, and minor illnesses. This not only keeps health care costs lower for your employees, but also helps manage and coordinate their care within the network.
While an HMO doesn’t pay for care delivered by out-of-network providers, your employees will always be able to receive care in an emergency. So, for example, if you have an employee who lives in Iowa and they have a medical emergency out-of-state, they’ll still have coverage.
When should my employees choose an HMO over a PPO?
There are several instances where your employees may prefer an HMO over a PPO plan. Some may simply want to pay less for their monthly premiums and won’t mind switching doctors in exchange for lower overall costs. Others may want the convenience of managing their care locally, which is beneficial if they have a chronic condition that requires them to see more than one provider.
An HMO plan is also ideal if your employees already receive most of their care close to home (i.e., they live and work in the same city or state and don’t travel much).
Want to learn more about the benefits of offering an HMO plan to your employees in Iowa? We're here to help. Contact your authorized Wellmark Blue Cross and Blue Shield account representative, or email us at blueatwork@wellmark.com Send Email.
