First, let’s define PPO. A PPO is a “preferred provider organization” is a hybrid of a discount and insurance program. It is often highly favored among consumers as the type of health insurance that provides the highest level of benefits and most personal freedom to visit any doctor you would like. A PPO is very different from an HMO or an indemnity plan, as will be described next.
How A (Preferred Provider Organization) PPO Works
The two most important things to understand about a PPO are in-network and out-of-network (OON) benefits.
In-network benefits are from doctors, pharmacies, hospitals, and other healthcare organizations that have partnered with your insurance company to provide you with high-quality care at a discounted rate. Not only is the overall rate less expensive, but the percentage that you have to pay is often much less (10% to 20% of the total bill is standard). It is greatly to your benefit to remain “in-network” to be sure that you have
to pay the LEAST amount out-of-pocket and will receive the highest level of health insurance benefit. A PPO is named because these “in network” professionals are “preferred” and your health insurance company, ideally, wants to receive all of your care from these preferred providers.
Out of Network PPO
Out-of-network (OON) means that with a PPO, you are free to see any healthcare provider you would like. If you would to see a doctor out-of-network, your health insurance will still pay for some of it (about 50% is standard), but you will be responsible for a greater portion of the overall cost. Also, the overall cost is often much higher than in-network because these providers have not agreed to offer a discounted rate. If you receive care OON during an emergency, you can petition the health insurance company to pay on an in-network basis. Other than this situation, it is much to your financial benefit to remain in-network when choosing where to get your healthcare.