The one-line difference
An HMO (Health Maintenance Organization) trades flexibility for price. A PPO (Preferred Provider Organization) trades price for flexibility. Everything else follows from that.
Monthly premium vs total cost
The premium is what you pay every month whether or not you see a doctor. The deductible is what you pay for care before the plan starts sharing costs. HMOs typically win on premium; PPOs often win when you actually use a lot of care outside a narrow network.
A useful test: add twelve monthly premiums to the deductible you realistically expect to hit. That number, not the premium alone, is what the plan costs you in a normal year.
Networks and referrals
HMO plans require a primary care physician who coordinates your care and issues referrals. Out-of-network care is generally not covered except in emergencies.
PPO plans let you book a specialist directly and reimburse a share of out-of-network bills, though at a lower rate than in-network care.
Who each plan fits
HMO: healthy individuals and families who stay local, want predictable copays, and prioritize the lowest monthly payment.
PPO: frequent travelers, people managing a chronic condition with an established specialist, and households who cannot risk their doctor being out of network.