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Preferred Provider Organization (PPO)

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Preferred Provider Organization (PPO) refers to a type of healthcare plan that allows you to choose your own doctors and hospitals from an established network of healthcare providers. As a user, you would typically pay a lower co-payment when choosing a doctor from the partnered hospital. 

PPO plans are designed to provide more flexibility and choice than other health insurance plans and offer a plethora of benefits such as lower out-of-pocket costs, coverage for preventive care and immunizations, and access to a wider range of specialists.

Health Insurance UAE Plans

The above plans and premiums are for AED 150,000 Sum insured for 1 Adult of 21 Years for Dubai city.

PPO plans also offer additional coverage for speciality care, such as vision and dental care as well as mental health services. PPO plans typically have a deductible that has to be paid before any benefits are paid, although some plans may offer a lower deductible for preventive care. Apart from this, PPO plans may offer coinsurance. 

PPO plans are becoming increasingly popular as a way to provide individuals with more convenience and flexibility in their health care coverage. Despite having higher premiums, these plans can be tailored to meet the specific needs of individuals and make for a highly-effective solution. 

How Does PPO Work?

A PPO health insurance plan functions in partnership with a network of healthcare providers which agree to accept a lower fee for services provided to PPO plan policyholders. Individuals insured by a PPO plan must use the services of a participating provider to receive benefits. 

PPO members can certainly go with a provider outside of the network but will have to pay a higher cost for the service. In a PPO plan, the policyholder has a deductible - once the deductible requirements are fulfilled, the plan would cover the coinsurance amount and the member would be responsible for the rest. 

PPO plans also have co-payments that have to be paid at the time of service, with the insurance company paying the remaining amount. These types of plans usually have an annual maximum out-of-pocket limit. Once this limit is reached, the insurance company pays 100% of all covered services.

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Merits and Demerits of PPO

If you are wondering whether opting for a PPO plan is worth it, go through the following advantages and disadvantages of the plan to make an informed choice for yourself  

Merits 

  • Preferred Provider Organization plans are one of the most popular types of health insurance plans due to their flexibility, cost savings, and access to a wide variety of medical providers
  • With a PPO plan, you can choose any doctor or specialist within the network, which makes it easy to find a provider that fits your needs and budget. Additionally, you do not need to get a referral from a primary care physician to see a specialist, which can save time and money.
  • No referral by a primary doctor or physician is required   

Demerits

  • One of the major drawbacks of a PPO plan is that policyholders are responsible for coordinating their health care. Unlike HMOs, they do not require a referral from a primary physician or doctor. 
  •  Another downside to PPOs is that they often have high deductibles and co-payments, which can be a burden on those who are already struggling to pay for medical care. Additionally, PPO plans may not cover certain treatments or services such as fertility treatments or alternative medicine services, which can add to the cost of care. 
  • As you can access healthcare centres, clinics, and hospitals outside your network, you may be required to submit additional documents and go through additional procedures, which can often be time-consuming 

How Much Does a PPO Plan Cost?

Compared to traditional health insurance plans, PPO plans come with a higher premium. This is due to the wide range of options they provide to policyholders compared to the regular plans. The cost of each plan, however, depends on multiple factors, with the primary ones being -  

  • Premium: This refers to the payments that you make at specified intervals (monthly, annually, and so on) for your insurance plan  
  • Deductible: Deductible is the amount that policyholders are required to pay before the concerned insurance providers start to pay for a particular claim 
  • Copay: A copay in any health insurance plan is the amount that the insured agrees to pay for a specific portion of the incurred medical expenses. 

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PPO v/s HMO 

In the table below, we will discuss what an HMO (Health Maintenance Organization) is and how it is distinctive from the Preferred Provider Organization. 

Preferred Provider Organization (PPO) Health Maintenance Organization (HMO)
Insurance companies have a contract with healthcare organisations (hospitals and  health centres) to form a network of participating providers Insured individuals receive health care services from a designated insurance provider
Policyholders do not need a primary care physician for a referral Primary healthcare doctors and physicians are necessary for further coordination
With a PPO plan, the insured individual is free to choose physicians or doctors who are not even included in an insurance-arranged network With an HMO plan, individuals have to select a doctor or physician included in their healthcare network
PPO plans have comprehensive coverage with a wide range of options With HMO plans, individuals have a limited healthcare network to choose from
Preferred Provider Organisation plans have higher premiums due to their accessibility and convenience Health Maintenance Organization plans have comparatively lower premiums as the options are limited

Have a look at some of the most frequently asked questions regarding PPO below - 

FAQs

How do deductibles in the PPO plan work? 

When it comes to PPO, there are two deductibles - one for in-network coverage and another for out-of-network coverage. After selecting a plan, the exact deductible amount is mentioned in the agreement. Once you pay the amount, the provider starts to pay for the required services as well.

Which plan is better? PPO or HMO?

Both health insurance plans have their own advantages and disadvantages. If you want to avail yourself of a wide range of options of partnered hospitals and doctors, it is better to choose PPO. However, if the cost of insurance is your primary criterion, opt for HMO plans. 

Is PPO an ideal health insurance plan?

If you are looking for multiple choices and high flexibility, you may go for a PPO plan.

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