What Is a HMO Insurance Policy?

HMOs, or health maintenance organizations, are one of many types of health insurances available to help cover health-related expenses.

A health maintenance organization pays for health care provided by members of a network of doctors and hospitals established by the company.

Group HMOs are offered through employers or associations for their employees or members and their families. The employer pays for part of the coverage. Individual HMOs are purchased directly from the provider by one person or a family.


HMOs typically require patients to choose a Primary Care Physician and then visit that doctor for care or to receive a referral for a specialist.


In exchange for the coverage provided by an HMO, it is necessary to pay a bi-weekly, monthly or annual premium, with group plans typically having lower premiums that individual plans. HMO insurance usually requires the insured to pay co-pays or fees when visiting a doctor or emergency room.


HMO insurance policies usually require members to pay fewer health care expenses on their own than other types of health insurance according to the Insurance Information Institute.


In some cases, you may be denied coverage by an HMO due to a pre-existing condition or an illness or condition that you have when you apply for coverage. Group policies sometimes feature open enrollment, which guarantees employees coverage despite their general health.