Trend: Consumers dumping HMO plans

In the past, consumers went for HMOs to save money, sometimes paying as much as $400 per year less than they did for PPO options. These days, however, as the price difference between the two types of plans has narrowed to about $150 per year, employees are fleeing HMOs for more-flexible PPO plans, observers say. Today, only one in five workers chose an HMO option, as opposed to one in three 10 years ago, according to the Kaiser Family Foundation. Meanwhile, the number of PPO enrollees has doubled since 1996.

Perhaps the most important factor in the switch is that employee contributions for HMO and PPO plans are about the same these days. This has happened, in part, because HMOs are agreeing to more fee-for-service contracts and fewer cost-controlling capitation contracts. Despite all of this, HMOs can still save money for some consumers, with out of pocket costs for HMOs at $920 per year and PPOs at $1947 per year.

To learn more about this trend:
- read this Chicago Tribune article

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