How do Health Maintenance Organizations (HMOs) primarily operate?

Health Maintenance Organizations (HMOs) primarily operate by financing and organizing health services for their subscribers. This model emphasizes a network of healthcare providers who deliver a range of services under a pre-paid system. Subscribers are typically required to choose a primary care physician within the network, who coordinates their care and refers them to specialists as needed. This integrated approach is designed to promote preventive care and ensure that healthcare services are both accessible and affordable for members.

This framework contrasts with other models where individual policies are sold or where insurance solely focuses on hospital services. HMOs aim to manage healthcare costs while maintaining quality by emphasizing preventive care and efficient service delivery within their established networks. Thus, the operational model of HMOs centers on comprehensive health service management rather than the narrower scope suggested in other choices.