In the new network HMOs, doctors are now required to obtain prior authorization for many procedures. HMO members must sign up with a primary care provider who must approve visits to a specialist. Patients are restricted to a limited list of doctors and hospitals. In addition to a monthly premium, patients pay a small co-pay per visit. Capitation has been attacked by critics for creating a large incentive to deny necessary care.
Patients are free to see any doctor on the preferred list, including specialists.
PPOs are a kind of compromise between HMOs and indemnity insurance. PPOs are less restrictive but more expensive than HMOs and more restrictive but less expensive than indemnity insurance. Today PPOs are the most popular and fastest growing insurance option for Americans who get coverage through an employer.