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Can We Switch From HMO to PPO?

When it comes time to choose a health insurance plan, you may have access to both a health maintenance organization (HMO) and a preferred provider organization (PPO). Both types of plans have their pros and cons; and if you find that the HMO you have is not living up to your expectations or filling your needs, you can change to an available PPO the next time open enrollment rolls around.

  1. Open Enrollment

    • If you get your health insurance through your employer, you need to wait until the open enrollment period comes around before you can make any changes to your coverage. For most employers the open enrollment period takes place in the last quarter of the year, typically around October or November. During this period, employees can choose their coverage options for the next year. If you bought your HMO plan on the open market, check with your insurance broker to see when your current contract expires. As the expiration date nears, you can start shopping around for a PPO plan that may be a better fit.

    Available Plans

    • When open enrollment starts at your company, check the list of available plans carefully. Many, but not all, companies offer a PPO option to their employees. If your company does not currently offer a PPO, talk to your human resources director or insurance representative about adding that option. You can shop for an individual PPO if you wish, but the premiums could be much higher than what you currently pay through your employer. If your employer is offering a PPO for the upcoming year, review the plan details carefully to make sure it meets your needs.

    Provider Network

    • The provider part of a preferred provider organization is critical since it impacts how much the plan will pay and even if the services will be covered at all. Before you choose a PPO, you need to carefully review the list of network providers to ensure that all the current health care providers you use are on the plan. Look for not only your family or primary care physician, but also any specialists you see and any hospitals you use. Most health insurers provide a search feature that prospective members can use to search for doctors, clinics and hospitals near where they live and work.

    Plan Costs

    • No matter how good the PPO plan, it is worthless if you cannot afford it. When switching from an HMO to a PPO, it is important to review all of the applicable costs. These costs include the monthly premium, of course, but also copayments, deductibles and other out-of-pocket expenses. Review the plan documents carefully to find the total out-of-pocket costs and the percentages for any copays. Review the payment schedule carefully since most PPO plans pay a significantly higher percentage of covered costs if you use a network provider.

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