In general the biggest difference between PPO vs. POS plans is flexibility. A PPO, or Preferred Provider Organization, offers a lot of flexibility to see the doctors you want, at a higher cost. POS, or Point of Service plans, have lower costs, but with fewer choices. There are many more details you'll want to compare, as well.
PPO vs POS: What are the main differences?
When you're comparing health plans it's important to understand what sets them apart from one another. This way you can make a decision based on your needs. Here are some main features that you can compare to find out what makes a PPO different from a POS:
- Costs (deductibles, coinsurance, copays, and premiums)
- Primary Care Provider (PCP) requirement
- In-network requirement
- Referrals to other providers
Comparing costs between PPO and POS
When it comes to the costs for PPO vs. POS plans, how do they stack up?
- Deductibles: PPO plans usually come with a deductible. This means you pay for care and services until the deductible is met. Then your plan starts sharing costs. POS plans typically do not have a deductible as long as you choose a Primary Care Provider, or PCP, within your plan's network and get referrals to other providers, if needed.
- Copays: Both PPO and POS plans may require copays. This is a fee you pay to a doctor at the time of a visit or for a prescription medication.
- Coinsurance: You may be required to share some of the costs for your care with both a PPO and POS plan. For a PPO plan your coinsurance kicks in once you've met your deductible. With a POS plan coinsurance costs could kick in if you need out-of-network care or fail to get referrals to see other providers.
- Premiums: This is what you pay monthly for your plan. Typically you will have a higher premium with a PPO because it offers more options. The POS plans usually have lower premiums because they offer fewer options.
Do you have to choose a PCP with a PPO or POS?
Some health plans require you to choose a Primary Care Provider. A PCP can serve as a home base for care. They get to know you and your health needs and can coordinate care with other specialists when needed.
- PPO plans do not require you to choose a PCP, but it's recommended. Referrals to specialists are also not required.
- POS plans require you to choose a PCP and to get referrals if you need to see other providers, except for OB-GYNS. In fact, "point of service" means that your PCP is your number one go-to for care—they are your initial point of service. If you need to see specialists or get any other care, your PCP will coordinate it.
Do you have to see doctors in a network with a PPO vs. POS plan?
A network is made up of doctors and facilities that contract with an insurance provider. Network providers typically agree to offer discounted rates to customers, which is the advantage to staying in-network. Some plans require you to see providers in a network.
- PPO plans do not require you to see in-network doctors and you don't need referrals, either. If you choose to see providers outside the network you will pay more because coverage is lower. If saving money is important, simply choose to stay in-network.
- With a POS plan you would be required to see your in-network PCP. As your point of service doctor they would have to refer to any other provider if needed, in order for you to receive coverage under your plan. This includes both in- and out-of-network providers.
Should you choose a PPO or POS plan?
Which plan you choose depends on what best meets your needs.
- If you're looking for a lot of choice and flexibility, you might consider a PPO. No PCP required, no referrals, and coverage for both in- and out-of-network providers. This choice and flexibility comes with higher plan costs, though.
- POS plans cost less, but offer fewer choices than PPOs. If you're not concerned about having to stay in-network, choosing a PCP, or getting referrals for other providers, then a POS plan may work for you.
Before choosing any health plan, make sure to review the details of coverage. These are high-level descriptions of PPO vs POS plans. Plans can vary widely between insurance carriers and those you may purchase on your own from the Health Insurance Marketplace.