Question

What is one advantage of HMOs

Answer 1

A advantage of HMOs is that they provide fixed amounts per person enrolled in the plan, incentivizing healthcare providers to limit the quantity of care provided.

Step-by-step explanation:

One advantage of Health Maintenance Organizations (HMOs) is that they provide fixed amounts per person enrolled in the plan, regardless of the number of services provided. This incentivizes healthcare providers to reduce moral hazard by limiting the quantity of care provided, as they only receive a fixed payment. This can help control costs and prevent unnecessary or excessive medical treatments.

Answer 2

A health maintenance organization, or HMO, is a group insurance policy in which covered members must get referrals from a primary care physician to see a specialist. Relative to other group policies, such as PPO and POS, HMOs offer financial savings and preventative health advantages. However, they present several restrictions for members.