Colorado Marketplace Plans: Understanding HMOs and Out-of-Network Coverage

Colorado Marketplace Plans: Understanding HMOs and Out-of-Network Coverage

Are you recently unemployed and need health insurance? Colorado residents have access to the Connect for Colorado Marketplace, where they can browse and compare health care plans. However, it’s essential to understand the different types of plans available and how they work, especially if you have specific care needs.

In this blog, we’ll focus on Health Maintenance Organizations (HMOs), which are the most common type of plan offered on the marketplace. We’ll also discuss out-of-network coverage and what it means for you and your family.

Understanding HMOs

HMOs are a type of health plan that emphasizes preventive care. They have a network of contracted providers who agree to provide services at negotiated rates. When you enroll in an HMO, you choose a primary care physician (PCP) who will coordinate your care and refer you to specialists within the network if necessary.

One of the main advantages of HMOs is their typically lower premiums compared to other types of plans. However, they also have some limitations:

Limited Network of Providers: HMOs have a closed network of providers, meaning you can only see doctors and specialists within that network. If you need to see a provider outside the network, you may have to pay higher out-of-pocket costs. This can be particularly concerning if you have a preferred provider or need specialized care.

Referrals Required: To see a specialist within an HMO, you typically need a referral from your PCP. This can add an extra step to your care and potentially delay appointments.

Out-of-Network Coverage: HMOs generally do not cover out-of-network services unless they are deemed medically necessary and pre-authorized. If you receive out-of-network care without pre-authorization, you may be responsible for the full cost of the service.

Out-of-Network Coverage

Out-of-network coverage refers to healthcare services received from providers who are not part of your insurance plan’s network. In most cases, out-of-network care is more expensive and may not be covered at all by your plan.

If you have an HMO plan, it’s crucial to be aware of the limitations regarding out-of-network coverage. Here’s what you need to know:

In-Network vs. Out-of-Network Costs: Services received from in-network providers are typically covered at a lower cost-sharing rate than out-of-network services. Co-pays, deductibles, and coinsurance may be higher for out-of-network care.

No Coverage for Non-Emergency Services: HMOs generally do not cover non-emergency services received from out-of-network providers unless they are pre-authorized. This means you may be responsible for paying the full cost of these services.

Pre-Authorization: If you need to see an out-of-network provider for a specific service, you may be able to get pre-authorization from your insurance company. This can help reduce your out-of-pocket costs, but it’s not guaranteed.


HMOs are a common type of health insurance plan available on the Connect for Colorado Marketplace. They offer lower premiums but have limitations regarding network restrictions and out-of-network coverage. If you have specific care needs or prefer to see providers outside your plan’s network, it’s essential to carefully review the plan details and understand the potential costs associated with out-of-network care.

If you need assistance navigating the Colorado Marketplace or comparing health insurance plans, our licensed agents can help. Contact us today for a personalized consultation.

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