What is a PPO health insurance plan?

Everything you need to know about how PPO plans work.

What you need to know

A preferred provider organization, or PPO, is a health insurance plan that allows you a lot of freedom when you choose a healthcare provider or doctor.

For starters, PPO plans work with a preferred network of providers -– hence the name. But they don't limit you from seeing doctors outside of that network. Most PPO plans cover at least some of the bill at out-of-network providers. You will, however, likely pay more at out-of-network providers than at in-network providers.

Secondly, PPO plans allow you to skip your primary physician and go straight to a specialist. Unlike HMO plans, which require that you see your primary physician and get a referral to see a specialist, PPO plans let you make appointments with specialists directly and without a referral.

PPO plans may also give you access to out-of-state providers that are still considered in-network.

PPO plans tend to have more expensive monthly premiums than HMO plans, though you may pay less for other services. Additionally, the freedom to see both in-network and out-of-network doctors may be well worth the additional monthly premium if that feature is important to you.