Know Your Plan Part 2: Understand Your PPO
In Part 1 of our series, we discussed utilizing your HMO. Knowing the features of your health plan type is vital: you can navigate your health benefits with confidence and avoid accidentally costing yourself more dollars. Continuing, this week we will talk about a PPO.
What is a PPO?
Like an HMO, a PPO is a type of managed care plan. This means the health plan has contracted with medical providers and facilities to create a network. A PPO – Preferred Provider Organization – provides coverage for care received in and out of the provider network. While members of a PPO can opt for out-of-network medical care, the discount and coverage will be significantly less than care received in-network.
Features of a PPO
The biggest thing to remember about a PPO is that in-network care will always be more affordable. Yes, most PPO plans do offer some type of discount or coverage for care that is out-of-network, but you’ll always end up paying more.A significant number of employer-based insurance and health plans purchased on the exchanges are PPOs; they remain a popular option. PPO plans usually have a higher monthly premium than an HMO, but they offer some advantages in exchange for that bigger price point:
Lower deductibles. PPOs have lower deductibles (for both individual and family plans) than HMOs. Healthcare Trend Alert: Even though the deductibles are lower comparatively, PPOs’ deductibles are higher than ever. This is true of most health plans – rising healthcare costs have resulted in generally higher deductibles. Know the details of your plan and budget accordingly.
Larger provider networks. This gives members more options. There are more doctors and facilities within a PPO network than that of an HMO.
No referrals needed. While an HMO requires all care to be coordinated through a Primary Care Physician, you don’t need to consult a single doctor to see a specialist. With a PPO, you’re able to schedule appointments with in-network specialists with no penalty.
Saving Money with Your PPO
While the features of your PPO are set, there is a lot of opportunity to save while using your plan. The decisions you make at different points in your medical care can cost you big.
Stay In-Network We touched on this, but want to make sure it’s stressed: you’ll pay considerably more for out-of-network care, even if your PPO still offers coverage. Check your health plan’s website for the specific difference in discount and coverage between in-network and out-of-network costs.
Manage Your Out-of-Pocket Healthcare Costs Your deductible and premiums are not the only costs you’re responsible for. Check your benefit plan details for the amount you’re expected to pay in co-pays and co-insurance. Keep an eye out for percentage based co-pays. If your PPO has a percentage based co-pay, your choice in provider is doubly-important. There is no standard pricing in healthcare, and even within your network, prices range up to 500%! If you choose a pricier provider, you’ll end up paying a lot more out of your own pocket. Finding fair priced providers is essential.
Track Your Own Deductible Yes, your health insurance company will track your deductible for you. Unfortunately, there’s a lag. This means that it can take up to 120 days for your medical claims to be processed and your account information to be updated. If you’ve already met your deductible, it may not show up in the doctor’s system and you’ll be asked to pay again. Track your own deductible so you’re aware of just how much is left on your deductible balance and you only pay what you actually owe. Overpaying and chasing a refund can be a messy and frustrating process.
Have a Question? We’d Love to Help!
If you have a question and want further clarification about your PPO plan, comment below. We’re here to help improve your health, financially.