Chapter 46
HEALTH MAINTENANCE ORGANIZATION (HMO)
LEARNING OBJECTIVES:
A. Have a basic understanding of health maintenance organizations
REVIEW:
This brief chapter looks at health maintenance organizations (HMOs). HMOs are
presented as an alternative to traditional health insurance, with the benefit of
(generally) lower employee expenses. Three types of HMO model are covered:
staff model, group practice model, and individual practice association (IPA) plan.
Tax treatment is the same as for other health care plans. A reference is provided
for learning more. The chapter includes an extended chart comparing an insured
plan with two types of HMO plans.
CHAPTER OUTLINE:
A.
B.
C.
D.
E.
F.
G.
H.
I.
What Is It?
When Is IT Indicated?
Advantages
Disadvantages
HMO Benefit Structure
Types of HMOs
Tax Implications
Where Can I Find Out More About It?
Comparison Chart
FEATURED TOPICS:
Health Maintenance Organizations (HMOs)
1
Chapter 46
FIGURES:
Figure 46.1 Employer, Inc. Comparison of Health Care Benefits
CFP® CERTIFICATION EXAMINATION TOPIC:
Topic 29: Group medical insurance
A. Types and basic provisions
2) Managed care plans
b) Health maintenance organization (HMO)
COMPETENCY:
Upon completion of this chapter, the student should be able to:
1. Have a basic understanding of health maintenance organizations
KEY WORDS:
health maintenance organization (HMO), staff model, group practice model,
individual practice association (IPA)
DISCUSSION:
1. Discuss advantages and disadvantages to using an HMO rather than a
traditional health care insurance plan.
2. Discuss differences between the three types of HMO organization.
QUESTIONS:
1. Which one of the following is normally a cost containment feature of most
HMOs?
a.
b.
c.
d.
co-payments
coinsurance percentage
stop loss limit
expense reimbursement
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2. Which of the following is typical of an HMO benefit structure?
a.
b.
c.
d.
reimburses employees for expenses
employs or contracts directly with providers
pays providers for health care as required by employees
employer/subscribers pay a fee for each service used by employees
Chapter 46, p. 353
3. Which of the following are usual types of HMO organization?
(1) preferred provider organization
(2) group practice model
(3) individual practice association
(4) staff model
a.
b.
c.
d.
(1) and (3) only
(1) (2) and (3) only
(2) (3) and (4) only
(1) (2) (3) and (4)
Chapter 46, p. 354
4. In which one of the following are doctors directly employed by the HMO?
a.
b.
c.
d.
independent practice
group practice
IPA
staff model
Chapter 46, p. 354
ANSWERS:
1. a
2. b
3. c
4. d