Medicare Health Maintenance Organizations (HMOs) must offer all Medicare Part A and Part B benefits. Part A is inpatient hospital insurance, and Part B is outpatient insurance. They can also offer Medicare Part D benefits. Part D is Medicare’s outpatient prescription drug benefit. If you want Medicare prescription drug coverage and you are in an HMO, you must receive your drug coverage from the same plan. Some HMOs offer additional benefits that Original Medicare does not cover, such as vision and dental care.

  • Many HMOs charge a monthly premium (in addition to the Medicare Part B premium). You also usually pay a fixed amount (called a “copay”) every time you get a service.
  • Generally, you are only covered for the care you get from doctors, hospitals and other health care providers that are in the HMO’s network. Except in emergencies or urgent care situations, if you use other doctors and facilities you will pay the full cost of the care you receive. Keep in mind that doctors may leave the HMO at any time.
  • While you are away from home, you usually only have coverage for emergency or urgently needed care.
  • You need to select a primary care physician (PCP) who coordinates your care and decides when you need to see a specialist. You usually must get the PCP’s permission or referral before seeing a specialist.
  • Some HMOs offer a point-of-service (POS) option that may allow you to use services out-of-network, or without a referral or prior approval.  Plans must have a limit on your out-of-pocket costs when you use the POS option. Check with your plan to see what rules and costs apply when you get care from out-of-network providers.   
  • All HMOs must have a limit on your out-of-pocket costs (deductibles and co-pays). These limits, called maximum out-of-pocket costs, can be high but they may protect you from excessive costs if you need a lot of care or expensive treatment. The maximum out-of-pocket cost for most HMOs in 2018 is $6,700. 
  • Medicare HMOs cannot charge higher copayments than Original Medicare for certain care including chemotherapy, dialysis and durable medical equipment. However, HMOs can charge you more than Original Medicare for other services, including home health, skilled nursing facility and inpatient hospital services.