Preferred Provider Organization – PPO

AAA

DEFINITION of 'Preferred Provider Organization – PPO'

A type of health insurance arrangement that allows plan participants relative freedom to choose the doctors and hospitals they want to visit. Obtaining services from doctors within the health insurance plan's network, called "preferred providers", results in lower fees for policyholders; however, out-of-network doctors are still covered. Coverage under a preferred provider organization (PPO) requires ongoing payment of premiums by policyholders to the insurance company.

BREAKING DOWN 'Preferred Provider Organization – PPO'

In contrast to an HMO, with a PPO it is not necessary to designate a single doctor as a policyholder's primary care physician, nor is it necessary to obtain a referral from a primary care physician in order to see a specialist such as an orthopedist or an ear, nose and throat doctor. However, non-emergency hospital visits and outpatient surgery often must be pre-approved by the insurer in order to be covered.

RELATED TERMS
  1. Unallocated Benefit

    A provision available in health insurance policies, where the ...
  2. Health Savings Account - HSA

    An account created for individuals who are covered under high-deductible ...
  3. Insurance

    A contract (policy) in which an individual or entity receives ...
  4. Premium

    1. The total cost of an option. 2. The difference between the ...
  5. High-Deductible Health Plan - HDHP

    A health insurance plan that has a high minimum deductible, which ...
  6. Consolidated Omnibus Budget Reconciliation ...

    A landmark federal law passed by Congress in 1986 that provides ...
Related Articles
  1. Home & Auto

    Health Insurance: Paying For Pre-Existing Conditions

    If you bring a pre-existing condition to a new insurer, you may find yourself without coverage.
  2. Home & Auto

    Fighting The High Costs Of Healthcare

    If your employer is cutting medical benefits, a health savings account may be right for you.
  3. Home & Auto

    5 Insurance Policies Everyone Should Have

    Insurance policies come in a wide variety of shapes and sizes. Shop carefully and the right policies will go a long way towards helping you protect your assets.
  4. Insurance

    Buying Private Health Insurance

    Getting your own policy isn't easy or cheap but in some cases, it's well worth the effort.
  5. Insurance

    Should You Bite On Dental Insurance?

    Don't pay for a plan that won't cover your pearly whites when you need it to.
  6. Insurance

    Find Secure And Affordable Post-Work Health Insurance

    Learn how you can avoid financial catastrophe - without Medicare.
  7. Options & Futures

    How To Choose A Healthcare Plan

    HMOs? PPOs? CDHPs? We'll clear up the confusion so you can find the right coverage.
  8. Technical Indicators

    Use Market Volume Data to Determine a Bottom

    Market bottoms often carve out classic volume patterns that let observant traders make fast and accurate calls.
  9. Mutual Funds & ETFs

    ETF Analysis: First Trust Dorsey Wright Focus 5

    Take a closer look at the First Trust Dorsey Wright Focus 5 ETF, a unique and innovative fund of funds based on momentum and relative strength.
  10. Technical Indicators

    4 Ways to Find a Penny Stock Worth Millions

    Thinking of trading in risky penny stocks? Use this checklist to find bargains, not scams.
RELATED FAQS
  1. Tame Panic Selling with the Exhausted Selling Model

    The exhausted selling model is a pricing strategy used to identify and trade based off of the price floor of a security. ... Read Full Answer >>
  2. Point and Figure Charting Using Count Analysis

    Count analysis is a means of interpreting point and figure charts to measure vertical price movements. Technical analysts ... Read Full Answer >>
  3. How are double exponential moving averages applied in technical analysis?

    Double exponential moving averages (DEMAS) are commonly used in technical analysis like any other moving average indicator ... Read Full Answer >>
  4. What happens if my insurance claim falls below the deductible level?

    Though the ins and outs of health insurance are often confusing, the concept of the insurance deductible is relatively straightforward. ... Read Full Answer >>
  5. How is the deductible I paid for my insurance claim treated for tax purposes?

    The deductible you pay on your health insurance policy may be tax-deductible if you meet certain conditions. However, whether ... Read Full Answer >>
  6. What are the alert zones in a Fibonacci retracement?

    The most commonly used Fibonacci retracement alert levels are at 38.2% and 61.8%. A 50% retracement level is also commonly ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Financial Crisis

    A situation in which the value of financial institutions or assets drops rapidly. A financial crisis is often associated ...
  2. Election Period

    The period of time during which an investor who owns an extendable or retractable bond must indicate to the issuer whether ...
  3. Shanghai Stock Exchange

    The largest stock exchange in mainland China, the Shanghai Stock Exchange is a nonprofit organization run by the China Securities ...
  4. Dead Cat Bounce

    A temporary recovery from a prolonged decline or bear market, followed by the continuation of the downtrend. A dead cat bounce ...
  5. Bear Market

    A market condition in which the prices of securities are falling, and widespread pessimism causes the negative sentiment ...
  6. Alligator Spread

    An unprofitable spread that occurs as a result of large commissions charged on the transaction, regardless of favorable market ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!