Overview of a PPO Health Insurance Plan
The preferred provider organization, or PPO for short, is one of the most popular types of health care plans available on the market today. Preferred provider organizations seek to control premiums by keeping costs under control, allowing individuals and businesses alike to get more coverage for their limited benefit dollars.
There are a number of similarities between HMO and PPO plans, most notably the fact that both types of plans utilize a limited number of doctors, hospitals and other health care professionals. Each of these health care providers signs a contract with the PPO, agreeing to accept a set payment for each service they provide. These contractual agreements help to keep costs low and premiums affordable.
As with HMOs, it is important for would be PPO participants to ensure that their personal physicians participate in the plan. . That is because going outside the network can be quite costly, resulting in denied claims or increased out of pocket costs. Using network providers gives plan participants the best value, with lower out of pocket costs and less paperwork.
In fact one of the chief advantages of a PPO plan is reduced paperwork. Unlike traditional fee for service plans there are typically no claim forms to submit – all the paperwork is handled by the in network provider and the insurance company. All the individual need do is present his or her card and the plan does the rest.
PPO plans generally require participants to choose their own primary care physician, and that doctor will coordinate all care, including referrals to specialists, diagnostic tests and needed treatments. Preventative care, inoculations and other routine care is generally fully covered as long as network providers are used.
With a PPO individuals do have the option of using out of network providers, even though the costs of doing so are typically quite a bit higher. The required deductibles and co-payments are generally much higher for out of network providers, and participants may want to consider using in network providers whenever possible. Doing so can help keep costs under control for everyone.