Preferred Provider Organization Plans — PPO Plans, Coverage, & Quotes
PPO insurance is a type of managed care group health insurance. A Preferred Provider Organization, also known as a PPO health plan, contracts with a group of providers such as hospitals and physicians. Like an HMO, it requires you to pay monthly premiums and covers unlimited health care services. PPO plans offer more freedom to your employees and a lower cost of business health insurance to you. There are co-payments involved with a PPO, which can cost around $10-$30 per prescription, visit, or test. Most PPO plans also require you to pay a deductible before the coverage takes effect, although co-payments are often considered as fulfilling part of that amount.
A PPO health insurance plan gives you more control over your health care. For one thing, you can select any doctor you choose. Similar to other forms of managed care, there is a network of physicians that works with your PPO medical plan. If you choose a primary care physician within the PPO plan’s network, most of the cost will be covered less a small co-pay. PPO plans are able to offer services at a reduced rate because sponsors pledge to increase patient volume within the network. Small group health insurance, therefore, is cost-effective since it brings many customers at once. As opposed to other individual health insurance plans that force you to cover the entire cost of out-of-pocket, PPO plans will pay part of the bill. You will have to shoulder more of the cost than you would if you saw an in-network physician, but the option is still there. Remember that you may have to fill out and submit paperwork in order to get the partial claims paid for if you go out-of-network.
The other significant difference of PPO health plans is the concept of “self-referral”. Employees will not have to wait for your primary care physician (PCP) to approve and refer them to a specialist. This can save money (in the form of the co-pay for your PCP visit) as well as time off from work for appointments. Instead, you can search for specialists within the PPO insurance plan’s network and make an appointment yourself.While doing so could be helpful for someone with a rare condition requiring special treatment from specialists unlikely to be covered in a PPO health plan, it is always a good idea to compare PPO plans and see if the physicians you want to see are in their networks. Some PPO insurance plans have larger networks than others. Your employees are allowed to see doctors outside of the business health insurance PPO network, but for a far more expensive rate.
In fact, PPO health insurance plans do not require anyone to have a primary care physician at all! While having one is recommended for preventative health reasons, a PPO health plan doesn’t force you to have a gatekeeper in charge of your health care. This can be very appealing. A PPO plan can cost employees more than a HMO: premiums, co-insurance, co-payments all add up. After all, high-deductible PPO may be a solution for many employer health insurance plans. As a result, employees will have greater responsibility and control over their health care. Another surprising pitfall of PPO plans is many only cover the specified percentage of “reasonable costs” for medical treatment. If the out-of-network physician or hospital charges above average rates, an employee may end up having to pay for the remaining bill above and beyond the standard co-insurance percentage.
Is a PPO health plan right for your business? VitalOne’s licensed group health insurance agents are ready to assist you in comparing the cost and coverage of small business PPO plans.
