How Do Copays Work for PPOS?

PPOs (preferred provider organizations) try to make their members an offer they cannot refuse, in the form of financial incentives!

PPOs are a type of managed care health insurance that grants their members both the option of seeking care from a list oflist of pre-approved providers who are part of their in-service network as well as allowing policyholders to seek any doctor they choose without having to go through a referral process.

However, the savings offered on in-network copayments makes utilizing that portion of the plan extremely attractive.

How copayments work

Insurance companies with managed care plans are able to provide cost effective and quality health care because of the restrictions imposed both onto the members and the providers under the plan. Typically, health care providers contracted to a PPO provider have to meet a certain quota of patients and are paid on a flat fee thus lowering the overall costs to the insurance provider.

To further control the costs, the managed care provider will entice members to visit those doctors as their services are already paid for and that will control any additional expenses that the patient might generate. Because of this arrangement,reasonable copayments in the amount of approximately $10 (routine office visit during regular hours) are the norm for those appointmentswithin the group’s network of practitioners.

PPOs allow for your choice of doctors

PPO members also have the flexibility to visit doctors listed by the PPO or of their own choosing without needing any type of referral. The copayment for visiting those doctors acts more like a coinsurance plan where both the insurer and the insured end up sharing the financial responsibility. Members of a PPO who go to these doctors must initially pay out-of-pocket and are generally responsible for meeting a deductible amount (which can range from $300-$1500). Once that amount is met, then the benefit of copayments or coinsurance will kick in.

It is important to note that the level of copayment can fluctuate in the above situation based based on whether a member chooses to see a doctor on the PPO pre-approved list or if they choose a physician completely outside of the network. If you are a member of a PPPO and choose to visit an out-of network provider, you will receive a lower rate of reimbursement for the copayment.