How does the HMO model control healthcare costs?

The HMO (Health Maintenance Organization) model controls healthcare costs primarily through the requirement for referrals for specialist services. This system is designed to manage and contain costs by ensuring that primary care physicians assess and coordinate care before patients see specialists.

When patients need to see a specialist, they must first consult their primary care physician, who evaluates the necessity of that referral. This adds a layer of oversight that can help prevent unnecessary specialist visits, which can be more costly. By streamlining the process and focusing on primary care, HMOs can effectively manage the overall expenses associated with patient care, leading to reduced healthcare costs for both the organization and its members.

The other options presented do not align with the cost-containment strategies of the HMO model. Allowing unlimited doctor visits could lead to increased costs, while encouraging the use of non-network providers generally results in higher expenses for the HMO. Comprehensive coverage without limits might enhance patient benefits but does not specifically address cost control. Therefore, requiring referrals is a fundamental aspect of the HMO structure that helps maintain financial efficiency within the healthcare system.