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PPO Insurance Plans

PPO plans, or “Preferred Provider Organization” plans, are one of the most common types of plans in the Individual and Family market. PPO plans enable you to visit whatever in-network doctor or healthcare provider you wish without first requiring a primary care physician referral.

How Does A PPO Plan Work?

As a member of a PPO plan, you will be encouraged to use the insurance company’s network of preferred doctors, and you typically won’t need to choose a primary care physician. No matter which healthcare provider you select, in-network healthcare services will be covered at a higher benefit level than out-of-network services. It’s significant to check if your provider accepts your PPO insurance, so you receive the highest benefit coverage.

You will perhaps have an annual deductible to pay before the insurance company starts covering your medical bills. You may also have a copayment of approximately $10 – $30 for certain services or be required to cover a certain percentage of the total charges for your medical bills.

A PPO insurance may be appropriate for you if:

• You want the freedom to select almost any medical facility or provider for your healthcare needs
• You want a portion of out-of-network claims to be covered by your insurance company.
• You don’t need to get referrals before visiting a specialist

PPO vs. HMO Insurance

In contrast to PPOs, HMO plans necessitate participants to receive healthcare services from an assigned provider—a primary care doctor who coordinates the insured’s care. Both programs allow the insured to seek a doctor’s care. Nevertheless, under an HMO plan, the designated primary care physician must provide a referral to a specialist.

PPO insurance plans charge higher premiums than HMOs for the convenience, accessibility, and freedom that PPOs offers, like hospitals and doctors’ comprehensive selection. Plans with the lowest/fewest out-of-pocket costs, such as those with low deductibles and low copayments, have higher premiums. The elevated premium cost is due to the insurer absorbing more of the associated expenses. Conversely, lower-premium alternatives translate into higher out-of-pocket costs for the insured and lower prices for the insurer.

PPO plans are also more comprehensive concerning coverage, as well as many services that other managed-care programs might exclude or for which they would charge an extra premium.

Historically, PPO plans were the favorite choice among employer group participants. However, currently, participants want more options for managed healthcare. Thus, many groups offer HMO plans, as well. Since HMO premiums are less expensive, some participants favor HMO plans for their affordability, although services and freedoms usually associated with PPO plans are often restricted.

Resources and References:

• Preferred Provider Organization
• Out-of-Network Providers