PPO Health Insurance

PPO insurance plans were created to fix the things people did not like about the affordable HMO plans. This is an attempt to keep the good savings each month provided by HMO's without the restrictive doctor and hospital networks. HMO's offered extra benefits when they came out that people really enjoyed. The biggest difference in benefits was the addition of the co payment for doctors visits. Before HMO's in the early 1990's there was no such thing as a co payment for a doctor visit. Doctor visits were covered under major medical plans at the time, but they were covered subject to a deductible and co insurance.

The benefits were great if your doctor and hospital was in the network. The main problem was that the HMO networks of doctors was usually very restrictive. In order to keep costs under control, many times these plans were designed by hospitals for patients of that specific hospital. So if you went to that hospital you were able to get the best benefits and lower costs. But if you went to another hospital instead, you would not have any coverage at all. If you had an emergency or needed a specialist for a dreaded disease people found themselves without any coverage at all outside of the network. So while people still loved the HMO plans they really wanted more flexibility in the place they could go to get health care.

PPO's were established to solve this problem. Instead of Health Maintenance Organizations, the Preferred Provider Organizations had networks of doctors that provided the extra benefits such as co payments for doctors and hospitals. But it also included provisions to cover services gotten outside of the network. So people have an incentive to go to doctors in the network so that they could get extra savings. But if they wanted to go outside of the network to a specialist or an emergency room, they would still have coverage. This allowed insurance companies to control costs with network contracts so the plans cost less. It allowed people to get the co payments within the network and still get coverage for services anywhere they needed.

Now PPO's are more available than HMO's because of the freedom of choice of specialists. It was a real problem finding specialists for certain conditions within some smaller HMO's. Insurance companies realized this and adjusted their plans to suit the needs of their clients. The PPO is a fantastic solution to getting great benefits at a low cost without sacrificing freedom to choose your own doctor and hospital.