A Health Maintenance Organization (HMO) is a form of managed health care. There are built-in cost containment features that help to reduce the risk of loss to the underwriting insurance company, thus reducing the cost to the business owner. For example, many Blue Cross/Blue Shield plans have HMO options that provide benefit plans for employees who choose physicians from a participating list of medical providers.

Most HMOs are organized similarly. The difference comes in the way the physician "panel" is structured. Prepaid group practice HMOs include practitioners that are located together at an office and are hired by the plan and paid a salary. Individual practice association HMOs include participating physicians who practice individually and are contracted by the HMO. In both cases, the HMO is receiving a prepaid premium from the plan participant.

Additional Information on Group Health Insurance

Comprehensive Major Medical Plan
Health Maintenance Organizations (HMOs)
Preferred Provider Organizations (PPO's)
Self Funded Plan
Cafeteria Plan
Conclusion

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