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PPO and POS Plans

PPO and POS plans are kinds of health plans. Like an HMO, these plans have provider networks, but you can choose to see doctors outside of the network and pay more.

The Department of Managed Health Care (DMHC) oversees Blue Cross of California and Blue Shield of California PPO health plans. The California Department of Insurance oversees most other PPOs in California.

PPO Plans

A PPO is a preferred provider organization. A PPO is good plan for people who want to see providers without prior approval from their health plan or medical group and who do not want to choose a primary care doctor.

  • You get most of your health care from a network of doctors and other providers.
  • You can choose to go outside of the network for some care and pay a higher cost.
  • You usually pay a yearly deductible before the PPO starts to pay some or all of your bills.
  • You usually pay a co-insurance, or percent of the bill, when you get a covered service. The PPO pays the rest.

POS Plans

A POS is a point of service plan. It is a mix between an HMO and a PPO.

  • You have a primary care doctor and you get most of your health care from an HMO network.

Out-of-Network PPO Costs

If you see a doctor or other provider who is not in your health plan's network, you and your plan share the cost of the service. However, your cost will usually depend on the plan's Maximum Allowable Amount for the service. This is the most your plan will pay for a service. It is usually about the same as what the plan pays providers who are in the network.

Before you see an out-of-network provider, you can ask your plan to tell you how much it will pay and how much you will have to pay.

Example of Out-of-Network PPO Costs


Network Hospital
(PPO pays 80%)

Out-of-Network Hospital
(PPO pays 60%)

Hospital charge



The PPO's Maximum Allowable Amount for the service



Your PPO pays

$14,000 x 80% = $11,200

$14,000 x 60% = $8,400

You pay

$14,000 x 20% = $2,800

$14,000 x 40% = $5,600

plus all of the amount over the allowed cost:
$22,000 - $14,000 = $8,000

$5,600 + $8,000 = $13,600