What is a Preferred Provider Organization (PPO)?

• A. A plan that allows members to see specialists without referrals and go out-of-network at higher cost.
• B. A plan that requires referrals for specialists.
• C. A plan that restricts to in-network only with no out-of-network option.
• D. A plan that provides government-funded coverage.

Answer: (A)

A PPO is a health plan that balances freedom and choice with cost savings. It allows you to see specialists without needing a referral from a primary care physician, giving you direct access to the care you want. It also lets you go out of network if you’re willing to pay higher costs, though using in-network providers usually costs less because of negotiated rates. This combination—no referral requirement for specialists and the option to visit out-of-network providers at higher out-of-pocket costs—is what makes a PPO distinct. Plans that require referrals are typically HMOs or POS plans, which limit specialist access unless approved by a PCP. Plans that restrict to in-network only with no out-of-network option describe an HMO setup. Government-funded coverage refers to programs like Medicare or Medicaid, not a PPO.