Preferred Provider Organization (PPO) (PPO)

A type of health plan that contracts with medical providers, such as hospitals and doctors, to create a network of participating providers. You pay less if you use providers that belong to the plan’s network. You can use doctors, hospitals, and providers outside of the network for an additional cost.

A network of providers which a health plan identifies as network providers for purposes of plan benefits. Typically the PPO requires the policyholder to pay higher costs when they seek care from an out-of-network provider.

A network of health care providers with which a health insurer has negotiated contracts for its insured population to receive health services at discounted costs. Health care decisions generally remain with the patient as he she selects providers and determines his or her own need for services. Patients have financial incentives to select providers within the PPO network.

A preferred provider organization (PP0) is a network of doctors and other healthcare providers that offers discounted care to members of a sponsoring organization, usually an employer or union.

You may also arrange private insurance coverage though a PPO.

If you're insured through a PPO, you make a copayment for each visit to a healthcare provider, though certain diagnostic tests may not require copayment.

You typically have the option to go to a doctor or other provider outside the network, but you pay a larger percentage of the cost, called coinsurance, than if you used a network doctor.