The definition of these terms can be critical. HMOs are the most stringent form of managed care. Participants must select a primary care physician, who controls access to services. HMOs have been around for years and have a history of solid union support. These days, though, many managed care plans, particularly HMOs, are run by for-profit companies.
Competition is fierce.
All plans are constantly looking for ways to cut costs and increase their market share. A PPO falls between an HMO and a traditional indemnity plan. Patients choose from a network of physicians and facilities who have agreed to discount the cost of services, but are paid for each service rendered. A POS plan is one that includes some type of managed care option, but allows participants to go outside of the managed care network by paying more. As in an HMO, participants select a primary care provider from the panel of participating doctors, who directs all care received.