Preferred Provider Organization (PPO) Plans

A preferred provider organization (PPO) is a group organization of doctors, hospitals and other agents who have agreed to provide health care at a reduced cost to certain insurance carriers. Ideally, the consumer benefits from this agreement as much as the doctors and health insurance companies, because they have the option of receiving health care at a lower cost than they would be charged as a walk-in patient.

If you are new to the health insurance game, it may seem more expensive to enroll in a PPO than an HMO. In fact, it is true that you will pay more on average due to the deductible and other out-of-pocket expenses. However, you are also paying for the freedom to choose your health providers, which can more than make up the difference.

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PPO Plan Details

The biggest advantage to choosing a PPO is the flexibility it allows. You do not have to choose your doctor from a list of providers--or worse, be assigned a provider. You can also self-refer to any physician or specialist you want. However, choosing a doctor outside of the network is more expensive. You will typically pay 30% more for out-of-network coverage, which isn't much when considering a $60 office visit but can add up quickly if you need hospitalization or highly specialized care.

Another advantage to choosing a PPO is that there is a limit to how much out-of-pocket expense you will meet, regardless of who you choose as your physician. For network care, your cost is limited to under $2,000 for families. This can be a big burden from the shoulders of families who are just barely scraping by. 

As in an HMO, a preferred provider organization often requires that members pay a small co-pay for office visits and other preventive services, rather than a percentage of the cost, and there are no claim forms or other paperwork to fill out. Members also have the freedom to choose how much they want to pay before receiving the advantaged rate. Deductibles in a PPO can vary between $500-$15,000, so families and individuals with many different financial circumstances can still afford coverage.

Preventive care in a PPO is usually covered on a no-deductible-required basis, as these health plans emphasize preventive services just like the HMO. Also like an HMO, you choose a primary care physician upon enrollment; however, unlike the more restrictive Health Maintenance organization, you are free to change your doctor any time you wish, and can see a non-network doctor as you wish, if you don't mind paying a higher cost and filing a claim for service.

Request more information on CA PPO Options >>