POP:
When a person has an HMO, they have an assigned medical group. The medical group is contracted with your health insurance company (Aetna, Blue Cross, Blue Shield, Connecticut General, United Health, etc.). Tea
The health insurance funds the medical group a certain amount of money each month in exchange for the medical group’s services (this is known as capitation in the industry) to its subscribers.

Thanks to this contract: Insurance companies save billions of dollars a year. An office visit that costs $500.00 for example, will be discounted by about $45.00 in an HMO type setting. In a PPO type setup, insurance will have no choice but to pay 80/20% or 90/10%; the same office visit that costs the insurance company $45.00 under an HMO contract, could cost them upwards of $350-$400.00 in a PPO type setting, forcing the insurers to increase their premiums

POS:
A point of service plan is also very expensive for insurance companies. The only reason POS plans have been successful is because people with HMOs (medical groups) often go outside of their network and see a doctor of their choice who is not contracted with their insurance company. The POS gives people the option to “opt out” (as it’s known in the industry) and see a doctor of their choice. Again, the same scenario applies. If most people stayed in their medical group (HMO side of their POS plan) instead of opting out and seeing a doctor of their choice who doesn’t contract with their insurance company, insurance would save billions dollars a year and monthly premiums would be reduced.