What does PPO stand for in health insurance terminology?

PPO stands for Preferred Provider Organization in health insurance terminology. This type of health plan offers a network of healthcare providers, where members have the flexibility to choose their healthcare providers, including specialists, both within and outside of the network. When members seek care from network providers, they benefit from reduced costs and better coverage, as these providers have contracted rates with the insurance company. This arrangement encourages members to utilize the plan's preferred providers while still allowing the option to receive care from outside the network, albeit at a higher out-of-pocket cost.

The term "Preferred" indicates that these providers are favored for cost and quality reasons, making the PPO model appealing for individuals who desire greater choice and flexibility in their healthcare decisions.