PPO Health Insurance

Preferred Provider Organizations (PPOs)

The preferred provider organization is a combination of traditional fee-for-service and an HMO. Like an HMO, there are a limited number of doctors and hospitals to choose from. When you use those providers (sometimes called "preferred" providers, other times called "network" providers), most of your medical bills are covered.

[PPO health insurance is not a pre-paid or capitated arrangement, does not have a mandatory referral procedure, and is not really a "combination" of fee-for-service and HMO. It is an arrangement to make claims payment more efficient and allow patients the convenience of not having to file claims.

[A PPO health insurance network can not be expected to include every medical provider in the state, but since it also typically provides out-of-network coverage, it is "limited" only in respect to in-network provider membership. A network used for PPO health insurance is going to be much larger than any panel or network for HMO health insurance. Whether "most of your medical bills are covered" will depend on the relative size of the bills and the out-of-pocket amounts you have to pay in the PPO health insurance plan - ed.]

When you go to doctors in the PPO, you present a card and do not have to fill out forms. Usually there is a small copayment for each visit. For some services, you may have to pay a deductible and coinsurance.

As with an HMO, a PPO requires that you choose a primary care doctor to monitor your health care. Most PPOs cover preventive care. This usually includes visits to the doctor, well-baby care, immunizations, and mammograms.

[Most, if not all, PPO health insurance plans do not require the selection of a primary care doctor. Most individual PPO health insurance does not cover much in the way of preventive care. That is because it is an elective expense, not an unexpected catastrophic medical expense needing financial protection. In some states all health insurance covers well-child care and some adult wellness because it is mandated under state law. - ed.]

In a PPO, you can use doctors who are not part of the plan and still receive some coverage. At these times, you will pay a larger portion of the bill yourself (and also fill out the claims forms). Some people like this option because even if their doctor is not a part of the network, it means they don't have to change doctors to join a PPO.

[In PPO health insurance, if a special doctor is not part of the network, any in-network copay for those doctor visits would not be available, an out-of-network copay would be a rare feature, and the out-of-network deductible would have to be met before the plan would contribute towards the cost of those doctor visits. The out-of-network feature may be valuable to some insureds if a special expert were needed to treat a dread disease and happened to be out-of-network. - ed.]

Questions to Ask About a PPO

• Are there many doctors to choose from? Who are the doctors in the PPO network? Where are they located? Which ones are accepting new patients? How are referrals to specialists handled?
• What hospitals are available through the PPO? Where is the nearest hospital in the PPO network? What arrangements does the PPO have for handling emergency care?
• What services are covered? What preventive services are offered? Are there limits on medical tests, out-of-hospital care, mental health care, prescription drugs, or other services that are important to you?
• What will the PPO plan cost? How much is the premium? Is there a per-visit cost for seeing PPO doctors or other types of copayments for services? What is the difference in cost between using doctors in the PPO network and those outside it? What is the health insurance deductible and coinsurance rate for care outside of the PPO? Is there a limit to the maximum you would pay out of pocket?

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