What are disadvantages of HMO?

Question

Edward Smith, ChFC, CRPS, AIF · Accepted Answer

Mostly the limitations of only having coverage for in network services, except for emergencies and some offer limited situations.

Daniel Maisel · Answer

Though Medicare Advantage plans 
(Plan C) can have good benefits, and HMO limits your Healthcare to your contracted network.

Their are other Medicare options that have less restrictions like PPO's and /or Medicare Supplements (Medi-Gap).

Many like a Medi-Gap plan because you can go to almost any Doctor in the USA.

Would you prefer that freedom?

When you are younger & healthier the freedom may not seem important. As we grow older, the odds are that we may have greater health issues where would prefer a greater selection of the highest caliber of available doctors. Some may not accept HMO'S or even PPO's.

Daniel Maisel Insurance - Medicare Agency 
(909) 319-5324.          Www.InsureItDan.com 
http://planenroll.com/?purl=yZLgRcNz

Holt Rushing · Answer

Not being able to go to doctors outside of the network. Also, not being able to go to more dentists and optometrists.

Stuart Graham · Answer

This question is hard to answer because it is very dependent on the HMO we are talking about. The obvious disadvantage would be that no out-of-network care is covered by the plan. But we have seen recently that providers refuse to take a PPO out-of-network, meaning the member didn't fare any better with the PPO.

Some HMO plans that have large networks are more stable and have better benefits than PPOs. Again, this is dependent on the plan and the area of the country.

Another potential disadvantage could be having to get referrals to see specialists; however, many HMO plans have removed that requirement, and you can see any in-network physician without a referral. Those plans function very similarly to a PPO.

I hope this helps, but I hope you can see it's not a black-and-white answer!

Steven Bleicher · Answer

If you are new to Medicare and understand that an HMO is a Network-based Advantage plan, you might want to reconsider another type of Advantage plan which is known as a PPO (or Preferred Provider Organization). This allows you to go both IN-Network as well as OUT of Network doctors. So, if your your "favorite" doctor is with Company X, that would be the insurance company to interview with an longtime experienced agent. However, it is going to be more likely that you enjoy dealing with a few different doctors. 

So, here's where the complication arises. This has happened to me on many occasions: My prospect gives me 5 names of doctors with certain specialties. Usually two of them are in one network while the remaining three are a part of a different network. Now it is up to you to determine whether it is best to choose the 2 doctors' network vs. the 3 doctors' network? Normally, a patient wants to retain their Primary Care physician and their cardiologist, as an example. So, it becomes necessary for your agent (be sure she/he is experienced enough to guide you in this important comparison)! It is extremely rare in my example for all 5 doctors being in the same network. 

The other dilemma with HMO/PPO's are that "Prior Authorization" is a part of both these plans. This is when a doctor has scheduled a test or treatment for you but has failed to receive your Advantage plan's company's approval. This is becoming more and more commonplace these days. Thus, it is imperative for your doctor to get this "advanced approval" or your procedure will be delayed by weeks! The same holds true for a doctor's prescription for an expensive RX. This could require what is called "step therapy" where the insurance company wants you to use a less expensive drug for your treatment. In not having gotten prior authorization, you are deprived of the "better" drug until the "other" cheaper drug has been eliminated.

Ami Fouts · Answer

HMO’s have a set network of doctors, so if you wanted to see a doctor outside of their network, they will not pay for that service.

Aaron Lewis · Answer

HMO Medicare Advantage Plans disadvantage is that you must stay within the network of providers that take that plan. In the event of an emergency situation you can go to any provider in or out of network.

Answered by Aaron Lewis on June 30, 2025

Agent Licensed in NJ & NY

Answered by Aaron Lewis Medicare Insurance Agent

Fred Manas · Answer

HMOs (Health Maintenance Organizations) have some significant drawbacks, primarily related to limited provider choices and the need for referrals. Specifically, HMOs restrict members to in-network providers, meaning you'll need a referral from your primary care physician (PCP) to see a specialist, and out-of-network care is generally not covered except in emergencies. 
Detailed Disadvantages:
Restricted Provider Network:
HMOs require you to use doctors and hospitals within their network. This can be limiting if your preferred doctors are not in the network, or if you travel frequently and need care outside your network's coverage area. 
Referral Requirement:
To see a specialist, you typically need a referral from your PCP, which can add extra steps and potentially delay care. This can be frustrating for those who prefer direct access to specialists. 
Limited Out-of-Network Coverage:
Out-of-network care is generally not covered by HMOs, except in emergencies, and even then, the definition of "emergency" can be strict. This means you'll be responsible for the full cost of any non-emergency care received outside the network. 
Potential for Disrupted Care:
If your PCP leaves the HMO network, you'll need to find a new one, potentially disrupting your established care relationships. This can also happen if your specialist leaves the network. 
Increased Cost for Out-of-Network Care:
While HMOs often have lower premiums than other types of plans, the costs associated with out-of-network care can be significantly higher, negating any initial premium savings.

Vachik Chakhbazian · Answer

have some significant drawbacks, primarily related to limited provider choices and the need for referrals. Specifically, HMOs restrict members to in-network providers, meaning you'll need a referral from your primary care physician (PCP) to see a specialist, and out-of-network care is generally not covered except in emergencies.

Answered by Vachik Chakhbazian on June 30, 2025

Agent Licensed in CA, AL, AR & 22 other states

Answered by Vachik Chakhbazian Medicare Insurance Agent

Andrew Kramer · Answer

Some people consider the following to be disadvantages of an HMO Medicare Advantage plan, however, I do not. #1 need referrals to see most specialists. #2 Can only see Dr's in the HMO network. #3 Cannot see Dr's outside of the county or counties of the HMO plan. However, the Advantages are: #1 low co-pays. #2 during travel in the US, can get care at any urgent care, or the ER of any hospital, on the co-pays of your plan. #3 typically better ancillary benefits, i.e. dental, vision and OTC. #4 better health outcomes because your PCP is monitoring all your specialist visits and Rx's. I believe the advantages of an HMO outweigh the disadvantages, especially better health.

Answered by Andrew Kramer on July 22, 2025

Agent Licensed in FL

Answered by Andrew Kramer Medicare Insurance Agent

Nicolas Cain · Answer

Disadvantages of an HMO include limited provider network, required referrals for specialists, less flexibility, no out-of-network coverage (except emergencies), and limited travel coverage.

What are disadvantages of HMO?

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What are disadvantages of HMO?

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Seniors: Ask a Question of Your Own

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A non-government resource website