What defines a health maintenance organization (HMO)?

A health maintenance organization (HMO) is characterized as a managed care organization that provides health care services through a network of providers for fixed fees. This structure is designed to control costs and focus on preventive care by encouraging members to receive their medical treatment within a designated network of doctors and healthcare facilities.

Patients typically select a primary care physician (PCP) who serves as a gatekeeper, coordinating care and providing referrals to specialists when necessary. This network model not only helps manage healthcare expenses but also ensures coordinated and comprehensive care for members.

The other options do not accurately reflect the nature of an HMO. For example, the notion of unlimited healthcare without a fee does not align with the fixed fee structure of an HMO, which requires members to pay premiums and potentially copayments for services. Additionally, the ability to see specialists without referrals typically refers to preferred provider organizations (PPOs) rather than HMOs. Lastly, while HMOs do cover a wide range of medical services, they do not cover all medical costs in the same manner as a traditional insurance policy might portray. Thus, the defining attributes of an HMO clearly support the characterization of a managed care organization with fixed fees through a network of providers.