The next step above an HMO or Health Maintenance Organization Health Insurance Plan is a PPO or Preferred Provider Organization Health Insurance plan. Unlike an HMO plan, the PPO will allow you to use a provider outside of the preferred provider organization. However, if you do use the PPO approved doctors and health care facilities, your fees will be lower and most likely covered by your insurance with little or no out-of-pocket expense to you.

Even if you go out-of-network, the PPO plan will still cover part of your expenses but you may be required to pay for services upfront, submit the bill to the insurance company and then be reimbursed. It is common practice for PPOs to pay up to 80% of out-of-network health care fees. There may be special circumstances where you can get the total bill covered such as if you require a specialist that is not available to you through the preferred provider network. In such a case, you would have to obtain a prior approval for the charges to be covered.

Benefits of PPOs

For patients who choose to use providers and specialists within the preferred provider network, you will enjoy a low co-payment and very little paperwork. Some preventive care services may not be covered with a PPO health care insurance plan. There are a few plans that are on the stricter side of PPO plans, these are Exclusive Provider Organization and they are very similar to HMO health insurance plans. With an EPO, if you go out of network, you may be responsible for the entire cost of the medical care you receive.

The PPO is less restrictive than the HMO but does not offer total freedom to choose your doctor of health care facility like the Traditional Indemnity Health Insurance Plan. It is somewhat of a middle-ground choice and may be a good option for those who want more freedom of choice but also want to enjoy lower health insurance premiums.

How It Works

If you have a PPO insurance plan, you can choose any doctor or health care facility inside the PPO network. Unlike an HMO, you are not required to choose a primary health care physician. You may choose to use an out-of-network health care provider; however, you should be prepared to foot a higher percentage of the bill if you choose to do so.

With most PPO plans, there is an annual deductible you must meet before the insurance company will begin covered 100 percent of your medical bills. There may also be a co-pay but most often this is a small amount such as a $10 or $20 co-pay for doctor’s office visits.

You will not have to get a referral to see a specialist if this specialist is inside your PPO network. However, if you do need to see a specialist and there is not one available in the PPO network, it may be possible for you to obtain approval and the total charge for your medical treatment covered. Different PPO plans vary on how out-of-network charges are handled so you should make sure you are clear on how your company handles this before choosing to go to an out-of-network doctor or health care facility.

Where to Buy

There are many insurance companies who offer PPO health care policies. Here are just a few insurance companies that offer PPO plans:

Aetna

Assurant Health

Blue Cross-Blue Shield

Humana

Pros & Cons

A PPO Health Insurance Plan is a good option for people who want more freedom in choosing health care options but are also looking for an affordable health insurance premium. You can visit a specialist within the PPO network without obtaining prior approval. One of the disadvantages is that if you choose to go outside of the preferred provider network, you may be responsible for the difference between what the out-of-network charges for services and what the PPO doctors charge.