PPO and POS Plans
PPO and POS plans are kinds of California medical insurance plans. Like an HMO, these plans have provider networks, but you can choose to see doctors outside of the network and pay more.
The Department of Managed Medical Care (DMHC) oversees Blue Cross of California and Blue Shield of California PPO medical plans. The California Department of Insurance oversees most other PPOs in California.
A PPO is a preferred provider organization. A PPO is good plan for people who want to see providers without prior approval from their plan or medical group and who do not want to choose a primary care doctor.
- You get your medical care from a network of doctors and other providers, but you can choose to go outside of the network and pay a higher cost.
- You usually pay a yearly deductible before the PPO starts to pay some or all of your bills.
- You usually pay a co-insurance, or percent of the bill, when you get a covered service. The PPO pays the rest.
A POS is a point of service plan. It is a mix between an HMO and a PPO.
- You have a primary care doctor and you get most of your medical care from an HMO network.
- You can choose to see doctors and other providers outside of the HMO network, but you will have to pay a much higher cost than if you stayed in the HMO network.
Out-of-Network PPO Costs
It is important to read your Evidence of Coverage (the booklet that explains your benefits) to understand the costs you will have when you go outside of the network in a California PPO plan. If you see a doctor or other provider who is not in your medical plan's network, you and your plan share the cost of the service. However, your cost will usually depend on the plan's Maximum Allowable Amount for the service. This is the most your plan will pay for a service. It is usually about the same as what the plan pays providers in the network.
Before you see an out-of-network doctor, you can ask your plan to tell you how much it will pay and how much you will have to pay.
Example of Out-of-Network PPO Costs
| ||Network Hospital |
(PPO pays 90%)
|Out-of-Network Hospital |
(PPO pays 70%)
|Hospital charge ||$22,000 ||$22,000 |
|The PPO's Maximum Allowable Amount for the service ||$14,000 ||$14,000 |
|Your PPO pays ||$14,000 x 90% = $12,600 ||$14,000 x 70% = $9,800 |
|You pay ||$14,000 x 10% = $1,400 ||$14,000 x 30% = $4,200 |
plus all of the amount over the allowed cost:
$22,000 - $14,000 = $8,000
$4,200 + $8,000 = $12,200