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Term Details - PPO

Preferred Provider Organization. PPOs manage medical costs by creating a network of providers who are willing to accept specified reimbursement rates and meet other requirements. Patients may choose any health care provider, but they will have to pay additional money if they use a provider who is not part of the PPO network. A PPO contracts with physicians and other healthcare providers, as well as hospitals and clinics, to create a group health care network. Insured members typically pay a co-payment at the time of medical service and must also meet a yearly deductible before the insurance company will start paying medical fees. There are both in-network and out-of-network services; however, out-of-network fees may be higher and the percentage the insurance will pay may be lower.

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Last Edited: December 3rd, 2010