Function

• An HMO functions as a prepaid health care plan and the network operates through a regulated group of health care physicians and organizations. The purpose of an HMO network is to provide health care to a designated group of individuals who must voluntarily designate their HMO provider.
  
  

Requirements and Qualifications

• Persons with an HMO qualify for in-network services only. Insured individuals must select a primary care physician from an approved list of providers, if insured through an HMO network. Pre-approval is required if an individual wishes to use an out-of-network provider. Anyone may enroll with an HMO and receive coverage, whether employed or unemployed.
  
  

Considerations

• The Health Maintenance Organization Act of 1973 allowed for the allocation of grant and loan funds to expanded health services and treatments provided by a predetermined physician. Today, HMOs are federally certified and regulated to ensure that the proper treatment and services are available to individuals within the network.