HMO, PPO, EPO, POS: the plan type sets the gates
Before a payer decides whether a service needs authorization, the plan design has already decided two other things: whether a specialist can be seen without a referral, and whether out-of-network care is covered at all. Both change the paperwork, and both are announced by the plan type on the card.
#A referral is not an authorization
The federal glossary defines a referral as "a written order from your primary care doctor for you to see a specialist or get certain medical services", and notes that in many HMOs "you need to get a referral before you can get medical care from anyone except your primary care doctor" - and that without one, "the plan may not pay for the services".
The two gates are different in origin and in failure. A referral originates with the primary care physician; an authorization originates with the payer's utilization review. One service can require both. They fail separately too: a claim can carry a valid authorization and still deny for no referral on file, and the denial text will say which gate was missed. What prior authorization actually is draws the same line from the other side.
#The four designs
| Type | Referral to see a specialist | Out-of-network coverage |
|---|---|---|
| HMO | Usually required, through the PCP | Not covered, except emergencies |
| PPO | Not required | Covered, at higher cost |
| EPO | Often not required; the plan document governs | Not covered, except emergencies |
| POS | Required | Covered, at higher cost |
The rows are the federal descriptions of the four designs; individual plans vary inside them, and the plan document always wins. The reason the table matters to authorization work is the compounding: a POS patient seeing a specialist needs the referral chain intact AND any authorization the payer requires, while a PPO patient may need only the authorization. Same procedure, same payer brand, different paperwork.
#What this means at the desk
- Establish the plan type at eligibilityThe eligibility response and the card both carry it. This is the moment the referral question exists at all; discovering it at the specialist visit is too late.
- Capture the referral like an authorizationA referral has an issuer, covered visits and a validity window. Record them against the encounter the way authorization constraints are recorded, because a claim will be matched against them the same way; see From authorization number to paid claim.
- Treat network status as a coverage questionIn an HMO or EPO, an out-of-network servicing provider usually means no coverage rather than reduced coverage. An authorization request for a provider the plan will not cover is wasted work; check the network first.
- Scan both sides of the cardThe back of the card carries the phone numbers that matter - customer service, provider services, sometimes a dedicated authorization line - and the front's member id is the search key everything else hangs on. A registration desk that images both sides removes a whole class of later phone calls.