HMOs are known as what type of plans?

Health Maintenance Organizations, or HMOs, are categorized as service plans. This classification emphasizes that HMOs provide a range of healthcare services to members through a network of providers, often requiring members to select a primary care physician. These plans are structured to offer a comprehensive approach to healthcare, which typically includes preventive measures, routine check-ups, and emergency services, all coordinated through the chosen primary care physician.

The nature of service plans is to focus on providing healthcare directly through in-network providers rather than reimbursing members for out-of-pocket expenses related to seeking care outside of that network. This framework is designed to keep costs lower for both the insurer and the insured, and it encourages the use of preventative care to help maintain overall health.