On November 25th, Kaiser Health News reported that insurers are offering fewer PPO (Preferred Provider Organization) plans for 2016, primarily due to cost. HMO (Health Maintenance Organization) plans–closed network, silver level–are rising in cost from $274 to $299, a 9 percent increase. Concurrently, the least expensive PPO–open access, silver level–premiums are rising from$291 to $339, a 17 percent increase.
The main difference between HMO and PPO plans is that in a PPO, an insurer pays part of a subscriber’s incurred out-of-network costs, while an HMO only covers costs for providers who have contracts with the insurer (in-network coverage only, basically).
Despite the design where PPOs only pay a portion of out-of-network costs, some markets are not offering them altogether (many counties in Florida, New Mexico, New York, Texas, and others), while some states are offering them exclusively (Alaska, Arkansas, and Wyoming). People purchasing coverage on the exchange are encouraged to consider their preferred providers and general annual costs when choosing a plan for 2016 that will meet their needs.