The Trouble With PPOs

Preferred Provider Organizations (PPOs) date back to 1980 when the first PPO was organized to provide contracted rate medical care to a health plan. For providing “steerage” toward the medical providers in the PPO network, the providers granted discounted rates for their services to the health plan.

Over the years, PPOs have changed and morphed into multiple variations, but the end result is the same – health plan members are steered toward PPO providers for their medical care and given favorable discounted rates.

The advantage of this type of arrangement is very obvious – it’s price.

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