Which organization provides health services on a prepaid basis?

A Health Maintenance Organization (HMO) provides health services on a prepaid basis, making it distinct in its operational model. Members of an HMO typically pay a monthly premium that covers a wide range of healthcare services, essentially creating a budgeted cost for the member. This prepaid system encourages the use of selected healthcare providers within the network to maintain affordability and control over expenses.

The structure of an HMO often includes a primary care physician (PCP) who coordinates care and refers patients to specialized services within the network. This enhances preventative care and overall management of health services, ultimately aiming to reduce costs while ensuring access for members.

In contrast, other options like Preferred Provider Organizations (PPO) and Exclusive Provider Organizations (EPO) provide more flexibility by allowing members to seek care outside of a network, but typically do not operate on a strictly prepaid basis. Independent Practice Associations (IPA) represent a different model where independent physicians come together to provide services and negotiate with payers, but they do not typically operate on a prepayment system like an HMO does.