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A Health Management Organization (HMO) is a form of health care provided in the United States among certain doctors and hospitals. HMO health insurance helps cover expenses only for doctors in the program.
History
The emergence of HMOs began with the U.S. Department of Health and Human Services in the early 1970s. Federal Laws were enacted to establish and fund HMOs.
Requirements
Companies with 25 employees or more are required to offer HMO options. This was mandated under the Health Maintenance Organization Act of 1973.
Types
With a staff HMO, a doctor is salaried and works as a direct employee for the HMO. In a group HMO, a group of doctors in private practice are contracted by the HMO, but not directly employed by the organization.
Effects
HMO health plans are designed to contain medical expenses for a patient covered under the program. The goal of the program is to reduce out-of-pocket expenses.
Examples
Blue Cross and Kaiser Permanente are both well-known HMOs that contract with physicians to provide medical care for patients.
Source:
Requirements of health maintenance organizations
Resource:
Blue Cross
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