Covered California Certified Enroller Practice Exam

How does an HMO generally manage out-of-network care?

1. It covers only emergency services

2. It typically does not cover out-of-network care

3. It allows members to choose any doctor

4. Full coverage is provided if pre-approved

The correct answer is: It typically does not cover out-of-network care

An HMO, or Health Maintenance Organization, typically operates on a managed care model that emphasizes the use of in-network providers. The correct answer highlights that it generally does not cover out-of-network care, meaning that if a member seeks services from a provider outside of the network, those costs are usually not reimbursed by the HMO. This approach encourages members to utilize a panel of pre-selected healthcare providers to manage costs and ensure coordinated care. In an HMO structure, members are usually required to select a primary care physician (PCP) who will oversee their healthcare needs and refer them to specialists as necessary, all within the provider network. Seeking care outside of this network often results in little to no coverage unless it's an emergency situation. While some HMOs may include limited provisions for emergency care received outside the network, the prevailing rule is that routine and non-emergency services are not covered when they are provided by out-of-network providers. Therefore, the understanding that an HMO generally does not cover out-of-network care is foundational to how these plans operate, so enrollers need to be clear with clients regarding the limitations and network restrictions involved with choosing an HMO plan.