HMO: Full Meaning and How it Works

Choosing from an array of health insurance plans from an insurance company is mostly limited to a specific type of health issues. However, HMO plans make things more convenient, and it broadens the scope of benefits for the beneficiary of the scheme.

HMO stands for Health Management Organizations in Nigeria. These organizations are charged with the responsibility of managing the provision of standard health care services via a network of hospitals under the plan. They serve as a middleman between the hospital and clients seeking healthcare services.

How HMO works in Nigeria

The users of HMO are companies with at least five employees. The Health Management Organization offers its services to companies seeking to provide healthcare services for its employees as well as their families. The arrangement works in the following way

  1.  The HMO company has a list of Healthcare service provider that can serve its clients (companies). 
  2. The HMO offers its services to companies seeking to provide healthcare for its employees. The services are offered under different product plans.
  3. An agreement is made depending on the type(s) of HMO plan the company’s employees opt for including the premium attached to it.
  4. The company agrees to pay the premium, which will cover the employees of the company based on their choice of products. Their choice of products is subject to the conditions of that plan for a stipulated time which is usually a year. 
  5. The employee selects a hospital from the list of healthcare service providers of HMOs like Hygeia HMO, Avon HMO, and so on.
  6. When an employee or any person eligible under the HMO scheme falls ill, the hospital is liable to attend to the patient if that was the choice of the healthcare provider as well as other considerations.
  7. The hospitals are often paid upfront regardless of whether the patient uses it or not.

What does the HMO premium cover?

HMO plans covers almost everything as regards to healthcare services ranging from medical checkups to major or minor surgery. However, there are restrictions based on the type of plan you opt for. Many HMO organizations would group their services into different categories, and the customer would have to select which plans works best. 

An HMO plan has many benefits and covers all but not limited to the following services mentioned below.

  • Ambulance Service
  • Dental care
  • Optical care 
  • General Outpatient and in-house specialist consultation
  • Admissions
  • Accident and Emergencies
  • Prescribes Medicines and Drugs
  • Physiotherapy
  • Scans
  • Antenatal and childbirth
  • Minor Surgeries and procedures
  • X-rays, Laboratory & Diagnostic Test

However, not all the plans offer the services as mentioned above. The services are dependent on the choice of plan for a given period.

Why is HMO a better option?

There are several reasons why you should choose an HMO plan instead of traditional health insurance, and they include the following

  1. There is high coordination between the HMO provider, and the healthcare provider makes it easy for clients to access healthcare services
  2. It is cheaper to maintain and easy to administer
  3. Many HMO plans do not have deductibles
  4. It is often the best choice in the case of emergency.

Frequently Asked Questions

Is HMO Compulsory in Nigeria?

HMO is not compulsory in Nigeria but we recommend you buy it for yourself and your household. Health Maintenance Organizations (HMOs) play a significant role in providing healthcare services  in Nigeria.

HMOs act as intermediaries between healthcare providers and individuals covered by health insurance, coordinating and managing the delivery of healthcare services. 

They strive to ensure that policyholders have access to quality healthcare and facilitate the settlement of claims between insurers and healthcare providers.

It is important to note that the specific details and requirements of health insurance coverage, including the involvement of HMOs, may vary depending on the type of insurance plan, the insurance provider, and other factors.

Therefore, it is advisable to consult with relevant authorities, insurance companies, or healthcare providers to obtain accurate and up-to-date information.

How to Apply for HMO in Nigeria?

To apply for Health Maintenance Organization (HMO) in Nigeria, you need to first,

  1. Identify the HMO of your choice and then register with them by filling out an enrollment form.
  2. You will need to provide your personal information, including your name, identity card, and contact information. 
  3. Once you have filled out the form, select the plan you are going for. Each HMO has a different plan that suits different needs.
  4. You can go ahead to pay the plan fee, which varies from one HMO to another. 
  5. After payment, you will receive your HMO identification number, which you can present at any hospital accredited by your HMO for medical treatment.

Different HMOs offer different health plans, so you need to choose one that suits your needs and budget.

Or if you work with a firm, the firm would handle the registration for you. But if you wish to do it yourself, and want your provider to deduct from your salary, you can do so. 

Follow the steps below: 

  1. Visit their office and go along with your personal information and work ID card. 
  2. Show evidence of salary payment like a payment slip for a period of 3 months. 
  3. Go along with your three months statement of account.
  4. If you want to add your spouse under your plan, go along with your marriage certificate.
  5. Fix an outstanding order with your bank to pay the insurance company monthly. Or you make a one time payment yourself.


Government officials and Civil Servants are also covered by a similar HMO scheme which is administered and managed by the NHIS (National Health Insurance Scheme)

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