What is the difference between in-network and out-of-network providers?

Managed care plans are some of the most affordable health insurance options available in California today. Most people will choose between one of two types of managed care plans: HMO health insurance and PPO health insurance.

HMOs and PPOs both contract with networks of care providers who will then offer care at reduced rates to plan members. When you visit any in-network care provider or in-network facility, such as a hospital or a lab, you will generally be responsible for a lower percentage of the final cost.

HMOs require their members to choose a primary care physician, or PCP, from their network of care providers. The PCP will act as a gatekeeper and make any referrals as needed. PPOs do not usually require PCPs, but they do have networks of preferred providers. You will often be able to self-refer to in-network specialists.

Out-of-network care providers are those who do not have contracts with your managed care plan. Out-of-network care providers are handled differently depending on whether you are a member of an HMO or a PPO.

If you are a member of an HMO, visits to out-of-network providers will often not be covered at all. The cost for out-of-network health care providers or facilities will often be entirely out of pocket. Additionally, your out-of-pocket costs may not count towards your deductible or total out-of-pocket limit.

PPO members tend to have more flexibility in their choice of care providers and may choose from either in-network or out-of-network providers. PPOs may cover out-of-network care at a reduced level than they cover in-network health care.

When shopping for health coverage, take into consideration how much flexibility you will require in choosing your health care providers and facility. Learn about your preferred plan’s network of care providers and facilities, and if you prefer more freedom in choosing your own provider, consider a PPO health insurance instead of an HMO for the most cost-effective plan.

 

Source: Health Coverage Los Angeles

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