What is a health maintenance organization (HMO)?

A health maintenance organization, or HMO, is a type of health insurance plan which offers coverage for certain healthcare services. HMOs are typically offered by employers, and typically require a member to select a primary care physician (PCP) from a list of approved doctors. The PCP is responsible for coordinating all of the healthcare services the member receives including, if necessary, referrals to specialists. As with other types of health insurance, members of an HMO are responsible for paying a monthly premium, and may incur additional out-of-pocket costs for certain services, such as prescriptions and copayments. Depending on the terms of the HMO plan, members may be limited in their access to certain types of care or be required to use specific providers. However, the advantage of an HMO is that all of the necessary medical care received is usually covered, and is often more affordable than other types of plans. In North Carolina, HMOs must be licensed by the Department of Insurance. As of 2020, there are more than 70 HMOs which have been approved to operate by the state. Additionally, HMOs are required to comply with specific laws and regulations intended to protect the rights and ensure the health and safety of members.

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What is a health maintenance organization (HMO)?

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