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What is a health insurance network?

The difference between HMO, PPO, POS and EPO

This article was last updated Dec. 6, 2022.

You’ve probably heard that when you see a doctor or other health care provider, it’s important to stay in your plan’s network. That’s because your health insurance company has reached agreements with certain doctors and hospitals to provide services at a discount to plan members — and if you get care outside of that network, you may be responsible for the full cost.

Health plans may offer several different networks to choose from. Generally, the differences between health plan networks include the number of providers, your ability to see specialists, out-of-network coverage, and out-of-pocket costs.

We’ve decoded common network types to help you find a plan that’s right for you.

Network type #1: HMO

HMO stands for health maintenance organization. This type of network gives you access to specific doctors and hospitals, and typically only covers out-of-network care in the event of an emergency. HMOs cover a wide range of services, but may allow only a certain number of visits, tests or treatments. You may need to select a personal doctor — also known as a Primary Care Provider (PCP) — who can refer you to specialists within the network for services, if needed. But, your overall costs will be lower. Because HMOs negotiate lower rates with specific providers, your carrier passes that savings on to you with less expensive monthly premiums and other out-of-pocket costs.

Searching for individual coverage in Iowa?

Wellmark Blue Cross and Blue Shield has a variety of HMO network plans for you to choose from.

Network type #2: PPO

PPO stands for preferred provider organization. This type of network offers more flexibility when it comes to choosing where you want to receive care and from whom. While your costs will be lower if you stay within your network, PPO network plans will pay a portion of the cost of seeing an out-of-network provider. You also have the freedom to see any specialist you want without a referral from your personal doctor first. Even though you may not be required to designate a personal doctor with a PPO plan, it's important to choose someone for regular care who you are comfortable with and someone who's trustworthy. Your personal doctor can be your go-to resource for all health care questions and can make life easier for you by coordinating with other doctors in the network.

Network type #3: POS

POS stands for point of service. These networks combine several features from HMOs and PPOs. You may need a personal doctor to coordinate your care (like with an HMO), but you'll be able to go outside the network to receive care in non-emergent cases (like with a PPO). While a POS plan offers the flexibility of going out-of-network, you'll pay a greater portion of all out-of-network charges.

Network type #4: EPO

EPO stands for exclusive provider organization. An EPO and HMO are similar because they both offer covered services if you go to local doctors, specialists or hospitals in the plan's network and geographic service area. You'll notice that EPO plans from Wellmark are available in South Dakota — offering members access to health care providers throughout the state and emergency care nationwide. 

Searching for individual coverage in South Dakota?

Wellmark Blue Cross and Blue Shield has a variety of EPO network plans for you to choose from.

HMO or PPO: Choosing a network

When considering your network options, ask yourself the following questions:

  • How often will I go to the doctor? Generally, an HMO plan has a lower monthly premium and other out-of-pocket costs. So, if you only visit the doctor once or twice per year, this network may be for you.
  • Do I want to continue seeing my current doctor? If so, are they in-network? If you're a Wellmark Blue Cross and Blue Shield member, you can quickly see if your current doctor is in a particular network by logging in to myWellmark® Opens New Window. With the HMO network, you can get quality care from 100 percent of hospitals and 98 percent of doctors in all 99 Iowa counties. Plus, you'll find participating HMO network providers in the counties that border our state.1

    Not registered for myWellmark yet? The process is easier than ever! You don't even need your Wellmark ID card to get started.

  • Will I need to regularly see any specialists? If you want the freedom to see any doctor or specialist you want regularly, a PPO plan may be a better fit. You're still able to see specialists with an HMO plan, but may have to ask for a referral — which can take time.
  • Do I travel frequently or live out-of-state for a portion of the year? If you live outside of Iowa, a PPO network is probably for you. Wellmark's PPO network includes 100 percent of hospitals and 97 percent of physicians in Iowa and South Dakota. Nationally, you will have access to 96 percent of hospitals and 95 percent of physicians.2

Everyone's needs are different. For more help determining the networks available to you and the best type for your situation, contact your authorized Wellmark agent Opens New Window or your HR benefits administrator.

1 Wellmark Blue Cross and Blue Shield network numbers as of Dec. 2022.

2 Consortium Network Compare Findings as of September 2019.