What Is a Health Insurance Network?
A health insurance network is a group of health care providers that your health insurance plan works with.
Networks include individual doctors, doctor offices, hospitals and other medical offices. The doctors in your plan's network are the only doctors or the most affordable doctors you can see. If you're buying health insurance, you should make sure the plan's network includes the doctors you want to see. And if you already have a policy, make sure you know what kind of network you have and how it works.
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Types of health insurance networks
Why you should know about provider networks
Knowing what kind of health insurance network your plan uses lets you choose doctors wisely. Many plans charge higher rates for doctors who are outside the plan's network, and some plans don't cover out-of-network doctors at all. Understanding your network lets you find cheaper, in-network providers. The most common and popular health insurance networks are HMOs and PPOs.
What are the different types of health insurance networks?
There are four types of health insurance networks: HMO, PPO, POS and EPO.
The type of network determines where you can get medical care, how much you have to pay when you see a doctor and how easy it is to see a specialist.
HMOs, or health maintenance organizations, only cover in-network doctors and require you to get a referral for specialists.
POS plans, or point-of-service plans, are a blend of HMOs and PPOs. In- and out-of-network doctors are covered, but you still need a referral to see a specialist.
PPOs, or preferred provider organizations, cover both in-network and out-of-network doctors, at least to some degree, and let you see specialists without a referral.
EPOs, or exclusive provider organizations, require that you see in-network doctors, but you don't need a primary care doctor or a referral to an in-network specialist.
HMO (Health Maintenance Organization)
HMOs have the cheapest rates of any health insurance network, at an average of $512 per month.
HMOs are great if you are looking for cheap health insurance. But they are cheap because they limit you to only seeing certain doctors and using certain medical offices. If you go to a doctor outside the plan's network, you have to pay the full cost yourself.
You also need to have a primary care doctor if you have an HMO health plan. This doctor, sometimes called a primary care physician or PCP, is the first person you see for your medical care. If you need to see a specialist, you have to first see your primary care doctor and get a referral.
How to tell if a doctor is in-network
Most large health insurance companies have an online tool you can use to search for in-network doctors. You can also call the customer service number and talk with a representative.
Once you find an in-network doctor, you should call the office directly to confirm they take your insurance. Health insurance companies are required by law to have accurate network lists, but sometimes online directories incorrectly list out-of-network doctors as being in-network.
PPO (Preferred Provider Organization)
A PPO gives you the best coverage but has a high average monthly rate of $613 per month.
With a PPO, you'll pay less when you go to an in-network provider, but you'll still have coverage for doctors who aren't in the PPO's network. You don't have to have a primary care doctor with a PPO, and you can typically see a specialist without a referral.
PPOs are great if you want the flexibility to see whatever doctor you want and still have some coverage. But the flexibility comes with a higher monthly rate, so these plans aren't as good if you're on a budget.
Point of service (POS)
POS plans are a blend between HMOs and PPOs.
Like a PPO, you can see any doctor you'd like, but you'll pay more if you go outside the network. But like an HMO, you need to get a referral to see a specialist.
A POS plan might be a good choice if you can't afford a PPO but still want more flexibility than an HMO. However, these plans aren't as common as HMOs or PPOs, and you might not be able to buy one. Not all companies sell POS plans, and they aren't available in every state.
Exclusive provider organization (EPO)
EPOs only pay for your medical care if you go to doctors within the network.
But unlike with an HMO, you can see specialists — as long as they're in the network — without a referral. If you go to an out-of-network doctor during an emergency, though, it should be covered. EPOs cost an average of $526 per month.
EPOs are less common than HMOs and PPOs, and you might not have access to one depending on where you live and what companies sell plans in your area.
Which health insurance network is the best?
PPO plans are usually the best choice if you are willing to pay the higher price.
Because PPOs still pay even when you go to a doctor that's not in the network, they can make getting medical care easier. If you go to the doctor often or have a complex medical condition, a PPO is a good option.
But HMOs are still often a good choice, even though they limit you to a strict network of doctors. If you don't go to the doctor often or if all your doctors are in your plan's network, an HMO can be a good choice. Because the monthly rate is cheaper, you'll save money each month.
Only you can decide what type of health insurance network is best for your situation. Think about how often you go to the doctor, what doctors you see and how often you see specialists. Then choose a plan that fits with your lifestyle.
Cost of health insurance by network type
Typically, HMO plans are the cheapest options and PPOs are the most expensive.
That's because HMOs limit you the most and PPOs give you the most flexibility.
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The cost of your health insurance also depends on your age, where you live, what plan level you buy, how many people are on your plan, and whether or not you smoke or use tobacco.
Health insurance rates by network type
Network type | Monthly rate |
|---|---|
| HMO | $512 |
| EPO | $526 |
| PPO | $613 |
Monthly rates are averages for a 40-year-old with a Silver plan. POS plans are excluded due to a lack of data.
Frequently asked questions
Which is better, a PPO or HMO?
A PPO is the best option for most people because it lets you see in-network and out-of-network doctors, and it usually lets you see a specialist without a referral. You'll pay more for out-of-network doctors, but you'll still have some coverage. But because PPOs are more expensive, they aren't good if you are on a tight budget. In that case, choose an HMO but check to make sure your doctors are in the network first.
What does "out of network" mean for health insurance?
An out-of-network doctor is one that isn't contracted with your health insurance plan. PPO and POS plans still cover out-of-network doctors, but you have to pay considerably more than if you went to an in-network doctor. HMOs and EPOs don't give you any coverage to go to an out-of-network doctor, so you have to pay the full cost. But in emergencies, you can see out-of-network doctors and you shouldn't be charged a higher rate.
What is a provider in insurance?
A provider is anyone that gives you medical care. It usually refers to doctors, medical offices or hospitals. An "in-network" provider is one that contracts with your health insurance plan. An "out-of-network" provider doesn't contract with your plan. But you might still have coverage depending on your plan's network type.
Methodology
Health insurance rates for 2024 were calculated using public use files (PUFs) from the Centers for Medicare & Medicaid Services (CMS) government website and from state-run marketplace sites. Rates are monthly averages for a 40-year-old with a Silver plan. Plans and providers for which county-level data was included in the CMS Crosswalk file were used in our analysis; those excluded from this dataset may not appear.
Editorial note: The content of this article is based on the author's opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.