PPO stands for Preferred Provider Organization, which is a type of managed organization that can be defined as a system of health care providers, or a network that has been set-up and organized by the health insurance company.
Typically the practitioners who provide medical services to insured members sign a contract with the PPO system. These doctors, clinics, hospitals, and specialists have agreed with the PPOs schedules and guidelines to serve the insured members.
Advantages of PPO plans
There are many advantages when it comes to PPO plans. For example:
- You have more flexibility when choosing a physician in contrast with an HMO plan, which tends to be very strict regarding choice.
- With a PPO healthcare plan you are also able to go to a doctor who is out-of your network and still be somewhat covered. You will most likely have to pay a co-insurance fee to see “out of network” doctors, but still you are entitled to do so.
- Another advantage of PPO plans is that you do not need to choose a Primary Care Provider or referring physician. This means that if you are interested in going to certain specialist, you may do so. The out-of-pocket costs per year in a PPO healthcare plan are limited, which can be really beneficial; that way you will be completely aware of the cost per year for medical expenses.
PPO Plans Disadvantages
Although there are many benefits to a PPO healthcare plan there are also some disadvantages you should consider before purchasing PPO plans. For example:
- PPO plans tend to be a little bit more expensive than the other managed care plans. This is mainly because of the flexibility provided by these plans.
- The deductibles and premiums of these plans tend to be higher than some of the other managed care organizations. As mentioned before, this is due to the flexibility and comprehensiveness of PPO plans.
Different types of PPOs
There are different types of PPO plans you can choose from. Some of the options are:
- PPO basic plan: as the name implies, this plan offers the most basic coverage. The rates are lower on a basic plan, because they carry a higher co-payment and deductibles. However if you are basically healthy, and have a healthy family, this is a great option as the times you will have to use the plan and pay the co-payment will likely be few.
- PPO standard plan: A standard PPO plan has a higher level of coverage in contrast with the basic plan, but is typically more expensive.
How much will it cost me?
PPO programs tend to be the most expensive type of managed care health plan. This is mainly because these plans tend to have a really comprehensive level of coverage; along with a lot of flexibility and choice when it comes to seeing doctors. The costs that tend to increase your premium are co-insurance payments. It’s important to keep in mind that these costs can vary based on whether you are using network providers or if you are using non-network providers. You can reduce costs by staying in network.
Aspects to consider before purchasing a PPO healthcare plan
There are several aspects you should consider before purchasing a PPO healthcare plan. Knowing your options will make it easier for you to choose the best health insurance for you and your family. You should be aware of all the terms, rules, benefits and disadvantages of any healthcare plan you are considering.
Here are some of the things to think about before making any decision.
- Can I go to a specialist if I need it?
- Is preventive care provided within the program?
- What are the limits and terms of medical treatments and services?
- How much is the premium and what services are rendered for the premiums?
- What rates are charged if I want to use a non-network doctor or physician?
- Is there an out of pocket maximum?
- Is there any specific location like offices or hospitals where I can go?
- What specialists, doctors and hospitals are available through the plan?
- What provisions does the plan have for emergency services?