HMO Limitations and Low Cost Health Insurance Coverage
Limited local eligibility for low cost health insurance
Comparatively few limitations exist. There may not be one in your area. Low cost health insurance HMOs are mostly geographically local organizations (except for the giants like Kaiser-Permanente, the largest in the country), and they do not exist in all areas. If you live in a big city or a heavy industrial area, there is probably one or more. If you live in a rural area, you may be out of luck.
Limited local eligibility. You may not be eligible for the HMO you think is in your area. All HMOs limit their membership geographically to an arbitrary selection of towns surrounding the town in which the HMO is located. If you live just over the border of this geographical limitation—even if it is just across the street—you cannot join.
Limited size. The HMO in your area may be full. Since the HMO is using its own facilities and staff, it cannot function with too large a membership. All HMOs, when they are first setting up, determine the ideal number of members they can most efficiently serve. In the beginning they operate at a loss, trying to build up membership. Once they have filled their quota, however, there is no way to increase the size of their plant, and an overlarge membership puts a strain on the whole operation. As a result, an HMO that has filled its quota will not take on new members until openings occur – enter your zip code into the search box to get low cost health insurance quotes.
This is another situation in which the direct-pay individual is at a disadvantage. Medicare beneficiaries and employee groups will be accommodated first, and it will take time for the HMO to expand sufficiently (if at all) to open membership to individuals. If your area HMO says it is full and will have no openings in the foreseeable future, you had better make other arrangements; it is possible you will never be able to get in.
There is always the chance, however, that a rival HMO will start up in what is obviously a good area for this kind of health care. Read the local papers and check occasionally with the Social Services office in your community.
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Other studies have shown hospital utilization by HMO members to be half the rate for persons covered by conventional insurance. Furthermore, conventional insurance plans often will not pay for diagnostic tests unless they are performed in the hospital, whereas HMOs try to provide as much medical care as possible out of the hospital.
A recent study indicates just how much HMO membership and low cost health insurance coverage may cut down hospital admissions. Done in the Washington, D.C., area, it compared hospitalization of the patients of fee-for-service physicians and patients of Group Health (one of the area's HMOs).
The former group had 793 hospital days per thousand (adjusted for age and sex), as against 459 days per thousand for the HMO. (The fee- for-service group were Blue Cross/Blue Shield enrollees.) In addition, the HMO patients were admitted 37 percent less frequently for appendectomies than comparable Blues enrollees, but there was no indication that their health was in any way impaired by the fewer operations.