5 Things to Know about a PPO

Understanding your options for health insurance can be confusing. There are a lot of choices. It can be hard to know which is the best health plan for you and your budget.

Many Americans get health insurance through their employers. Others look for health care coverage through the Health Insurance Marketplace.  If you are part of an employer’s group plan, a preferred provider organization (PPO) is often on the menu of health insurance choices.

Here are some things to know about PPOs.

1. A PPO offers a network of health care providers
   A PPO is a managed care network of doctors, hospitals and other providers like dentists and eye doctors. They contract with insurance companies to offer care at a more affordable cost to patients. When you see a doctor or go to a hospital within your network, you will enjoy the lower prices your health insurance company has negotiated with the provider. You can still use a doctor out of your network, but it will cost more.
2. A PPO is just one type of health plan
   Most people have access to PPOs through their employers, but not everyone. If you can’t choose a PPO insurance plan, then a health maintenance organization (HMO), high deductible health plan (HDHP) or consumer-driven health plan (CDHP) may be right for you. If you can participate in a PPO and expect high health care expenses, then a PPO might be right for you.
   
   If you rarely go to the doctor and have no health concerns, then you may decide to buy a plan with lower monthly premium payments. Think over your current circumstances and carefully review all of your choices before making your final decision. Choosing carefully can help you save the most money. You can always consult a health insurance broker or human resources department for advice.
3. Check into what you get with a PPO Plan
   You get access to a broad network of doctors, hospitals and other care providers at a negotiated rate. With a PPO, you have a flat copay fee for things like doctor and hospital visits. You may have to meet a deductible. Once you meet it, you pay a percentage of the cost for covered services, except preventive services. Preventive services are covered at no cost to you when you see a doctor in your network.
   
   With a PPO plan, you save money when you use doctors, hospitals and other providers that are in your network. Once you’ve hit your out-of-pocket maximum, your health plan pays qualified medical expenses  set by the Internal Revenue Service (IRS) at 100 percent. If you are dealing with an ongoing medical condition, or need to plan for an upcoming medical expense like an operation, a PPO plan may be right for you.
4. Know what  is not part of a PPO
   Not all doctors take every PPO health plan. Use the Blue Cross and Blue Shield of Illinois Provider Finder^® to make sure your doctor and hospital is in your PPO network
5. Learn the differences between a PPO and other health plans
   Your monthly premium (the amount you pay for the plan each month) can be higher in a PPO than with other health insurance plans. Your health insurance company pays a part of your doctor visit with a PPO. You can also help pay your medical bill with a Flexible Spending Account.
   
   Just remember you must also weigh a PPO’s higher monthly premiums in addition to copays for tests and doctor’s appointments. On the other hand, you also have more coverage and pay less at the time of a doctor’s visit and when you have bigger health events like hospital stays, surgeries and costly medical tests.

Compare features and choose the best health insurance plan for your needs.

Sources: Health Insurance Plan and Network Types,  Healthcare.gov, 2021; Medical and Dental Expenses,  IRS, 2021.

Originally published 6/14/2016; Revised 2021