Preferred Provider Organizations (PPO) Plan

PPO- This plan contracts with physicians and facilities to perform services and a specified rate. Its to ensure that PPO members are charged less than nonmembers

Point-of-service (POS) health insurance combines several elements from both HMO and PPO plans. Similar to health maintenance organization plans, (HMO), a member is required to choose a primary care physician and seek referrals to network specialists. Like preferred provider organization insurance, (PPO), members have the choice to receive care from non-network providers but typically incur larger out-of-pocket costs for venturing outside the network.

Another type of managed care program that was introduced is the Preferred Provider Organization (PPO). A PPO is comprised of a group of physicians, hospitals and other medical service providers who contract with employers, insurance companies or other plan sponsors. The PPO offers discounted pricing to these contracted organizations due to the high volume of business received. PPO’s typically have up-front cost sharing in the form of deductibles and/or co-insurance, which vary depending upon the actual plan chosen.

Most of the plans have a higher deductible, which allows the person holding the policy to have lower premiums. In order to control costs and compete for contract, the plans offer many managed care features (Valerius, Bayes, Newby, Seggern , 2008).

EPO vs HMO-- EPO contracts solely with specific specialists, clinics, hospitals and other health care providers to form a network. EPO clients know they don't have many options when it comes to providers, but they do have the comfort of knowing they'll always be reimbursed for any in-network expenses. HMO’s requires a co-payment on each visit while EPO’s have no co-pays. Both EPO’s and HMO’s keep costs low. EPO’s do not require a referral while HMO’s must confirm that specialized care is required before they will issue a referral

Preferred provider organizations have also contracted with hospitals and physicians to provide health-care services. Unlike the case with an HMO, you do not have to go to these physicians. However, you will pay more if you go outside the list of preferred providers. PPO plans usually have a deductible, which is the amount that the insured must pay before the PPO begins to pay. When the PPO plan does start to pay, it will usually pay a percentage of the bill and you have to pay the remainder, which is called “coinsurance.” Most plans have an out-of-pocket maximum. This helps protect you from paying more than a certain amount per year. After you exceed the out-of-pocket maximum, the coinsurance percentage paid by the PPO increases to 100%. (www.ajmc.com)

A Preferred Provider Organization plan is one which permits liberate movement equally within and outside of the organization's contributing provider association. The association may incorporate general physicians, experts, laboratories, diagnostic services, outpatient or free-standing accommodations, hospitals, resilient medical equipment, apothecaries, opticians, holistic/alternative contributors, therapists and more. “Free movement” inside the arrangement is generally referred to as referral-free access (or self-referral) to practitioners, specialists and more. Supplementary arrangement models will necessitate the preference of a Primary Care Physician (PCP) who is subsequently responsible for evaluating your care requirements and composing the applicable referrals for additional maintenance. Though, in a referral-free PPO plan various hospital admissions, diagnostic assessment, out-patient surgical treatment and more will necessitate pre- authorization. This is a procedure of informing the insurance provider of your intents to have specific services provided and basically obtaining their consent to do so. (Conference Associates,

Preferred Provider Organization PPO – Member are not required to have a PCP, and usually don’t need a referral to see a specialist. Is less restricted than the HMOs. They can receive care from in or out of network providers. PPOs offer an incentive to obtain care from in-network providers by paying a higher percentage of costs.

HMOs are usually the least expensive health plans, offer predictable costs for health care, the least administrative paperwork, and cover preventive care (Barsukiewicz, Raffel, & Raffel, 2010). However, HMOs also restrict direct access to specialists by requiring referrals by a PCP, requiring patients to see a provider in the HMO network, and often not covering more costly procedures or care options, because care is managed to control excessive or unnecessary care. Providers gain if they provide less care (Austin & Wetle, 2012). This incentive could affect patient-provider trust.

The relationship of an HMO and its physician member is to help provide a wider range health care for its patients and a wide area of services available for its physician members. A patient must choose a primary care physician from a list of providers. The relationship with the physician provided from the HMO is in a contract that is to deliver services to their patients for a fee. There can also be a group plan which is a HMOs contract with a group of physicians to deliver services. The HMO organization compared to PPOs, a PPO is a variation of an HMO, and it features traditional insurance and managed care.

An HMO delivers all health services through a network of healthcare providers and facilities. A primary care doctor to manage the care and refer to specialists when we need one so the care is covered by the health plan; most HMOs will require a referral before we can see a specialist. The plan may require us to pay the amount of a deductible before it covers care beyond our essential benefits. There are no claim forms to fill out.

A health maintenance organization (HMO) is a type of managed healthcare system. HMOs, and their close cousins, preferred provider organizations (PPOs), share the goal of reducing healthcare costs by focusing on preventative care and implementing utilization management controls.

The types of managed care are differentiated by definition, operation, structure, and information needs. `HMOs were the most common type of MCO until commercial insurance companies developed PPOs to compete with HMOs' (Douglas, 2003, p.331). `HMOs are business entities that either arrange for or provide health services to an enrolled population after prepayment of a fixed sum of money, called a premium' (Peden, 1998, p.78). There are three characteristics that an HMO must have. The first is a health care financing and delivery system that provides services for members in a particular geographic area. Second, is ensured access to a complete range of health care services, health maintenance, treatment, and routine checkups. Last, health care must be obtained from voluntary personnel that participate in the HMO. The five HMO models related to the participating physicians are the Staff

Under the HMO, each patient is appointed to a primary care physician (PCP), who is essentially accountable for the long-term care of the members that she/he has been assigned and any specialists that a patient needs to see should be referred by their PCP. Some examples of HMOs are Kaiser Permanente and Humana. HMOs have been licensed at the state level, under a license that is known as a certificate of authority. A pro of an HMO is that treatment for a patient can begin prior to their insurance being authorized; A member may benefit from this because there would be little to no treatment delays. A con of an HMO is that in order to save cost, most HMOs provide narrow provider networks; A member may not benefit if in an emergency because their “in-network” emergency room might be far or there are “quick-care” in their area.

The United States being referred for specialties depends on the insurance plan (Mossialos, Wenzel, Osborn, Sarnak, 2016, pp. 171-177). Health Maintenance Organization (HMO) plans give access to certain healthcare organizations and physician within their network that have agreed to lower rates for their services. The individual must agree to these services to have services covered. All services will be coordinated by the primary care physician PCP. Medicaid coverage is also based on these principles. Preferred Provider Organization (PPO) plan have higher premiums but give more flexibility. PPO allows the individual to see any physician they choose but cost is less if the individual stays within the network. PPO does not require that the individual have a PCP. No referrals for specialist are needed.