Preferred Provider Organizations (PPOs)
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Health insurance companies often give you several types of plans to consider. HMOs, PSOs, and PPOs are all popular options. Since each type of health insurance plan has unique pros and cons, you should learn about policies before deciding which one to buy.
Preferred Provider Organization (PPO) plans offer more flexibility than Health Maintenance Organization (HMO) plans, so some consumers prefer them over other options. PPO plans tend to cost more than HMO plans, though, so you need to weigh the pros and cons before purchasing a policy.
PPO health insurance encourages you to see practitioners within a specific network. Seeing a doctor or specialist within your PPO network usually means that you spend less money. The doctors that join the network agree to lower prices that make their services more affordable for people carrying insurance.
As long as you stay within the network of doctors, you get to take advantage of lower prices. Your PPO health insurance will also cover a higher percentage of the costs than if you see a doctor outside of the network.
Unlike HMO health insurance plans, though, PPOs do not require you to choose a primary care physician (PCP). With an HMO insurance policy, you need to see your PCP to get a referral for specialists. PPOs eliminate that requirement so you can go straight to a specialist without getting a referral.
PPO health insurance uses lower prices to encourage you to stay within the company’s network. You have the freedom, however, to see any practitioner that you want. Keep in mind that doctors and specialists outside of the PPO network can charge any price that they want. Most times, that means you will spend more money by seeing an out-of-network service provider.
Your PPO plan should cover part of your health care costs even when you see an out-of-network doctor. Your policy, however, will probably not cover as much of the cost. For example, your plan may cover 90% of the cost when you see an in-network doctor. When you go outside of the network, the policy may only pay for 50% of the cost.
The specific amount that a PPO plan covers will depend on your policy. Make sure you understand your coverage options before you commit to any PPO plan.
As you compare health insurance plans, you will probably notice that PPO policies often have some of the highest prices. Health insurance companies can charge more for PPO plans because some people want the flexibility that the policies offer. Instead of getting locked into an HMO’s small network, people with PPO policies can see any doctor.
When you think beyond the upfront costs of a PPO plan’s premiums, you may discover that you don’t spend as much as you think. For example, a person who gets an illness that requires treatment from an out-of-network specialist would have to pay out of pocket with an HMO plan. A PPO policy will typically cover a higher percentage of out-of-network services.
Remember that you also have some control over how much you pay for any health insurance plan. If you think that a PPO policy costs too much, consider raising the deductible. Larger deductibles push monthly premiums down.
Not all PPO health insurance plans offer the same perks. Generally speaking, though, you can expect to find a few common advantages no matter which PPO policy you select.
Flexibility is one of the most attractive aspects of PPO health insurance. Since you don’t have to see doctors within the plan’s network, you have the freedom to visit any service provider. That comes in handy when you travel or need to see a specialist. Going outside of the network might cost you a little more, but at least your insurance won’t force you to pay for 100% of the bill. PPOs also appeal to people who don’t want to waste time seeing PCPs for referrals. Without a PCP acting as a gatekeeper, you can see any doctor that appeals to you.
Cost is usually the biggest concern about PPO health insurance. Since PPOs give you more flexibility, health insurance companies charge higher premiums for them. You will also have to make a co-payment when you visit a service provider. Co-payments usually don’t cost a lot, but they can add up over time. You may also need to make a higher co-payment when you go outside of your PPO network.
Using a PPO plan can also mean that you have to fill out a lot of paperwork. As long as you stay in-network, your physician’s office will handle most of your insurance forms. When you go out of the network, though, you become responsible for completing and submitting insurance documents. It’s a bit of a hassle that can become overwhelming when you have a serious health issue.
PPOs have their good and bad points. As long as you choose a health insurance plan that fits your needs, though, you could discover that a PPO works best for you.