Medicare Advantage HMO vs PPO: What’s the Difference?

Choosing a Medicare Advantage HMO vs PPO is mostly a choice about doctors. Both are Medicare Advantage plans offered by private companies that contract with Medicare, and most include drug coverage. What differs is which doctors you can see, whether you need referrals, and what you pay out of network. Here’s how they compare under Medicare’s rules for 2026 and 2027, as Medicare.gov describes them.

What is a Medicare Advantage HMO?

An HMO, or health maintenance organization, generally covers care only from the doctors and hospitals in its network. Medicare.gov lists three exceptions: emergency care, urgent care when you’re outside the plan’s service area, and short-term dialysis outside the service area. Also, if no network provider can give you a covered service you need, the plan must help you get it out of network at in-network costs.

In most HMOs, you choose a primary care doctor. Medicare HMO referrals come from this doctor, and you usually need one to see a specialist. If you get non-emergency care outside the network without the plan’s approval, you may have to pay the full cost.

What is a Medicare Advantage PPO?

A PPO, or preferred provider organization, also has a network, and you pay less when you use it. You don’t have to choose a primary care doctor, and you usually don’t need referrals.

You can generally see doctors outside the network for covered services, if they agree to treat you and haven’t opted out of Medicare. Medicare PPO out-of-network costs are usually higher, though. Medicare.gov suggests you contact the plan first to make sure the service is medically necessary and covered.

Medicare Advantage HMO vs PPO: side by side

	HMO	PPO
Network	You generally must use it	You pay less when you use it
Out-of-network care	Generally not covered, except emergencies, urgent care and short-term dialysis outside the service area, or when the network can’t provide a covered service you need	Generally covered if the provider agrees to treat you and hasn’t opted out of Medicare, usually at a higher cost
Primary care doctor	Usually required	Not required
Referrals to specialists	Usually required	Usually not required
Emergency care	Covered in or out of network	Covered in or out of network
Yearly out-of-pocket limit	Yes	Yes, and it may differ for in-network and out-of-network care
Drug coverage	Usually included	Usually included

This is a general guide. Costs, networks and benefits differ by plan, so check each plan’s documents.

How do emergencies, urgent care and travel work?

Both plan types cover emergency care in or out of network. Urgently needed care is for a sudden illness or injury that isn’t an emergency. A PPO always covers it, and an HMO covers it out of network when you’re outside the plan’s service area.

Routine care is where travel matters. For plans that limit which doctors you can use, the service area is generally where you get routine care. So an HMO may not cover a checkup while you visit family in another state. A PPO may cover it as out-of-network care.

Plans generally don’t cover care outside the U.S., though some add a benefit for emergencies abroad. If you move out of your plan’s service area, the plan will generally end your coverage (Medicare.gov says plans can, and in some cases must). The move can give you a Special Enrollment Period to choose new coverage.

What rules apply to both HMOs and PPOs?

These Medicare rules, as Medicare.gov describes them, apply to either type:

• You generally keep paying your Part B premium (unless Medi-Cal or a Medicare Savings Program pays it), and the plan may charge its own premium.
• Each plan has a yearly limit on what you pay out of pocket for covered Part A and Part B services. Once you reach it, you pay nothing for those services for the rest of the year.
• You may need prior approval for some services. If you switch plans during a treatment, the new plan must give you at least 90 days before it asks for a new approval for that treatment.
• Networks can change during the year. If a doctor you see leaves, the plan will generally let you know.
• You can’t use a Medigap policy with either type. See Medicare Advantage vs Medigap.

Other types of Medicare Advantage plans

Medicare.gov lists more plan types. Three you may see:

HMO Point-of-Service (HMO-POS) plans

An HMO-POS plan is an HMO that may let you get some services out of network, for a higher copayment or coinsurance. You still follow the plan’s rules, like getting prior approval when it’s required.

Private Fee-for-Service (PFFS) plans

A PFFS plan sets how much it pays doctors and how much you pay. You can see any doctor who hasn’t opted out of Medicare, accepts the plan’s payment terms and agrees to treat you. Doctors outside a network can decide at each visit whether to treat you. You don’t need referrals, and if the plan has no drug coverage, you can join a separate drug plan.

Special Needs Plans (SNPs)

SNPs serve people with certain needs and must include drug coverage. They’re either HMO or PPO plan types, and you can stay in one only while you meet its conditions.

• D-SNPs: for people with Medicare and Medicaid (Medi-Cal in California). California’s Medi-Medi Plans are one kind.
• C-SNPs: for people with certain severe or disabling chronic conditions, like diabetes or chronic heart failure.
• I-SNPs: for people who live, or are expected to live, in a facility like a nursing home for at least 90 days in a row, or who need that level of care at home. See also Does Medicare cover long-term care?

Which plan type may suit you?

Neither type fits everyone. When you weigh a Medicare Advantage HMO vs PPO, start with your doctors and where you spend your time.

• An HMO may suit you if your doctors are in its network, you’re fine with a primary care doctor guiding your referrals, and you get most of your care close to home.
• A PPO may suit you if you want the option to go out of network and accept paying more when you do, or you spend part of the year away from home (ask how the plan covers care there).

Either way, compare drug lists, yearly out-of-pocket limits and what you might pay over a whole year.

How do I check a plan’s network and Evidence of Coverage?

Networks and rules differ by plan and can change each year. Before you join:

1. List your doctors, specialists, hospitals and pharmacy.
2. Use the Medicare Plan Finder. At Medicare.gov/plan-compare, add the providers who matter most to you, and the results show whether they’re in network with each plan.
3. Call each doctor’s office. Ask if they’re in the network for the exact plan you’re considering for 2027.
4. Read the Evidence of Coverage. It explains what the plan covers, what you pay and its rules for referrals and prior approval. For a plan you’re considering, look on the plan’s website or ask the plan for a copy. If you’re already a member, your plan sends it, or a notice on how to get it, by October 15.
5. Already in a plan? Read your Annual Notice of Change. It lists changes for January, including the network and service area. Plans send it by September 30.
6. Check your prescriptions on each plan’s drug list.

When can I switch between an HMO and a PPO?

You can change plans only at certain times:

• Open Enrollment, October 15 – December 7. Also called Annual Enrollment. You can join, switch or drop a plan for coverage that starts January 1, 2027. See our Annual Enrollment 2027 guide.
• Medicare Advantage Open Enrollment Period, January 1 – March 31. If you’re already in a Medicare Advantage plan, you can make one change, like moving from an HMO to a PPO. If you joined a Medicare Advantage plan when you first got Medicare, you can also make one change within your first 3 months of having Medicare. See our Medicare Advantage Open Enrollment Period guide.
• Special Enrollment Periods. Some life events, like a move, may let you change plans at other times.

For one-on-one help, you can call HICAP, California’s Health Insurance Counseling & Advocacy Program, at 1-800-434-0222. You can also call Medicare at 1-800-MEDICARE (TTY 1-877-486-2048).

Frequently asked questions

Do Medicare HMO plans require referrals?

In most cases, yes. Your primary care doctor refers you to specialists in the network. Some services, like a yearly screening mammogram, don’t need a referral.

Can I use my Medicare Advantage plan out of state?

For emergencies, yes. HMOs and PPOs cover emergency care in or out of network, and urgent care when you’re outside the service area. For routine care, an HMO generally covers only its network, while a PPO may cover out-of-network care at a higher cost.

Do HMO and PPO plans include drug coverage?

Most do. If you join one without drug coverage, you can’t add a separate Medicare drug plan, so check before you join.

Talk with a licensed Boomers agent

A licensed Boomers agent can go over the Medicare plans we represent in your area and check them against your doctors and prescriptions.

Find a licensed agent near you · See upcoming Medicare events

Or call 1-800-815-1943 (TTY 711), Monday – Friday, 9 AM – 5 PM Pacific.

Sources

• Health Maintenance Organizations (HMOs) (Medicare.gov)
• Preferred Provider Organizations (PPOs) (Medicare.gov)
• Compare types of Medicare Advantage Plans (Medicare.gov)
• Private Fee-for-Service (PFFS) Plans (Medicare.gov)
• Special Needs Plans (SNP) (Medicare.gov)
• Compare Original Medicare and Medicare Advantage (Medicare.gov)
• Urgently needed care (Medicare.gov)
• Joining a plan (Medicare.gov)
• Medicare & You 2027 handbook (Medicare.gov)
• Medicare Counseling (HICAP) (California Department of Aging)