Here’s a comparison between HMO and PPO type health insurance plans:

Health Maintenance Organizations (HMOs)

• Usually have the lowest premiums and lower annual deductibles. In return, you must submit to various cost-saving restrictions.
• You must get care from providers in your HMO network. You can’t use a doctor from outside the network unless in some special case it is explicitly approved (unless you pay for it yourself).
• You must find a primary care physician (PCP) who acts as a gatekeeper to other (in-network) specialists. For instance, your PCP decides if you need to see a cardiologist, dermatologist, urologist, whatever. Although this is designed to limit unneeded care, it can also be frustrating if you disagree with your PCP. It also underscores the importance of finding a good PCP.
• Often have less paperwork and forms to fill out.
• You are still covered for emergencies at whatever hospital can best provide care at the time, although they may transfer you shortly afterwards to an in-network hospital.

Preferred Provider Organizations (PPOs)

• Usually have higher premiums and higher annual deductibles than HMOs. In exchange it offers more flexibility.
• You can see any doctor, but the costs for you are lower if you see an in-network provider vs. an out-of-network provider. In-network doctors have agreed to a discounted fee schedule for people in the PPO, essentially providing a bulk discount. This is the PPO method of limiting costs.
• Even if you disagree with your PCP, you can still go to whoever you want (in-network or not).