HDHP vs. PPO Health Plans: What's the Difference?
If you're shopping for health insurance coverage, find out if a high-deductible health plan (HDHP) or Preferred Provider Organization (PPO) plan is right for you.
Plans insured by Cigna Health and Life Insurance Company, Cigna HealthCare of Arizona, Inc., Cigna HealthCare of Florida, Inc., Cigna HealthCare of Georgia, Inc., Cigna HealthCare of Illinois, Inc., Cigna HealthCare of North Carolina, Inc., and Cigna HealthCare of Texas, Inc.
What is an HDHP?
An HDHP is a category of health plans that feature lower monthly premiums. Because these plans have a higher deductible, that means you'll pay more in out-of-pocket costs before the health insurance company begins sharing the cost (also called "coinsurance").
You can combine an HDHP with a health savings account (HSA). You can use an HSA to help pay for certain medical expenses with funds from your paycheck that are free from federal taxes. Sometimes HDHPs are referred to as "HSA-eligible health plans." Many employers also contribute to HSAs.
There are several types of health insurance plans that have high-deductible options, including:
What is a PPO plan?
A PPO is a specific type of health insurance plan that typically features a large, national network of providers and health care facilities. With PPO plans, you are not required to have a primary care provider (PCP) or referrals for specialists.
A PPO plan may be considered a high-deductible health plan depending on how it's designed. There are PPO plans with high deductibles as well as PPO plans with low deductibles (sometimes called a "traditional PPO" plan).
Can a PPO be a high-deductible health plan?
Yes. A PPO can be a high-deductible health plan, depending on how the plan is designed. Some types if PPOs have a higher deductible and a lower monthly premium. Others have a lower deductible and a higher premium (which is sometimes called a "traditional PPO"). Compare the deductible, premium and out-of-pocket costs in your plan details to see which fits your needs.
Can I have an HSA with a PPO?
It depends on the plan. You can use an HSA with a PPO if it's also an HDHP and meets IRS requirements. A traditional PPO with a lower deductible is typically not HSA-eligible. Check your plan documents or contact a Cigna Healthcare® representative to confirm whether your plan is HSA-eligible.
What are the main differences between HDHP and PPO plans?
The features of HDHP plans and PPO plans depend on the type of plan and its design. Learn more about these plans’ costs and coverage.
| HDHP | Traditional PPO | |
|---|---|---|
| PCP Required | Varies by plan | No |
| Out-of-Network Coverage | Yes, at a higher cost | Yes, at a higher cost |
| Referrals Needed | Varies by plan | No |
| Monthly Premiums | Typically lower than a traditional PPO | Typically higher than an HDHP |
| Deductibles | High | Varies by plan |
| Coinsurance | Varies by plan | Varies by plan |
| Out-of-Pocket Maximum | Varies by plan | Varies by plan |
| HSA Eligible | Yes, if it meets IRS requirements | Only if designed as an HDHP |
Should I choose an HDHP or a traditional PPO plan?
Your choice depends on how much care you expect to need and how much you can pay up front.
In general: Choose an HDHP if you expect mostly preventive care and can cover a higher deductible, or if you want to pair your plan with an HSA. Choose a PPO if you expect regular visits or specialist care and want a large network without referrals.
Here are additional questions to help guide you in your decision-making.
How much medical care do you need?
Choose an HDHP if you expect mostly preventive care and can cover the deductible. Choose a PPO if you expect regular visits and want the freedom to see specialists without a referral.
Think about you and your family's medical needs. Do you typically only need regular check-ups, or will you require more appointments or treatments? If you need additional medical care, HDHPs may cost you more out of pocket.
How important is it to you to have an HSA?
If you're interested in using an HSA, an HDHP may be right for you. This is especially the case if you're able to make significant contributions to the account or if your employer contributes as well.
Can you afford a high deductible?
If you can afford a high deductible, it may be worth it to get an HDHP in order to have lower monthly premiums.
Do you want flexibility in choosing your providers?
If you're looking for a large network of physicians and facilities, and don't want to have to go through your PCP to coordinate care, a PPO plan may be right for you.
How do I find out if my provider is in network before I enroll?
It’s simple to search for participating health care providers, specialists, hospitals, facilities, and pharmacies that are in network with Cigna Healthcare:
Important: Just because a health care provider is listed in the directory doesn't mean that your health plan will cover all services. Look at your official plan documents, or call the number listed on your ID card, for information about the services your plan covers.
If you're already a Cigna Healthcare member:
- Log in to myCigna.
- Go to Find Care & Costs.
- Search for your doctor by name.
- Go to their directory page.
- Look for the "In Network" label. You can also estimate costs for services and procedures.
If you're not a member yet:
- Visit the Provider Directory.
- Select how you're covered.
- Enter your zip code location.
- Search for your provider by name.
- Once on the provider's profile page, you can choose different medical plans to see how they differ in coverage.
Product availability may vary by location and plan type and is subject to change. All health insurance policies and health benefit plans contain exclusions and limitations. For costs and details of coverage, review your plan documents or contact a Cigna Healthcare representative.