As a member of a PPO, or "Preferred Provider Organization," plan, you'll be encouraged to use the insurance company's network of participating doctors and hospitals. These providers have been contracted to provide services to the plan's members at a discounted rate. You won't be required to pick a primary care physician and you will be able to see doctors and specialists within the network at your own discretion.
You will probably have an annual deductible to pay before the insurance company begins paying your claims. Once the deductible is met, you'll be required to make a co-payment for most doctors' office visits. Some plans may also require that you cover a percentage of the total charges.
With a PPO plan, services rendered by an out-of-network physician are typically covered at a lower percentage than services rendered by a network physician. Seeing an out-of-network provider can become costly. For example, if you visit an out-of-network provider for services totaling $500, the PPO plan may cover the charge at only 60% of the amount that a network provider would charge for the same service. If a network doctor would accept $250 as payment in full, this means that the insurance company would pay only $150 and the remaining $350 would come out of your pocket. Additionally, if you see a provider outside of the plan's network, you may have to pay the charges up front and then submit your own claim for reimbursement.
PPO plans offer flexibility in choosing your providers, however, make sure that you familiarize yourself with the plan's provider network before choosing a PPO plan. You may wish to make sure that your favorite doctor or local hospital belongs to the network. If you have children who need to make regular visits to the doctor, be sure that you're aware of the plan's benefits for preventive and well-child care.
