PPOs vs EPOs

Jeremy Wolf |

Selecting the right health insurance plan for you and your family requires a clear grasp of your options. Let's break down two prevalent types of health insurance plans: PPOs, or Preferred Provider Organizations, and EPOs, or Exclusive Provider Organizations. Each offers unique benefits and operates differently. Below, we'll unpack the specifics of PPO and EPO plans, aiming to give you the clarity you need to choose confidently and wisely.

If you're looking for more detail on PPO vs HMO plans, check out our PPOs vs HMOs.

What is a PPO?

A PPO plan offers a higher degree of flexibility in choosing healthcare providers. With a PPO, you can visit any doctor or specialist without a referral. PPO plans typically do not require selecting a primary care physician, which may be preferrable if you don't yet have a specific doctor you want to see. For example, let's say you have a PPO plan and need to see a specialist. You can choose any specialist you prefer, schedule an appointment, and the services that specialist provides will be covered by your insurance plan — even if they are not in the plan's network. While the cost for that out-of-network specialist may be higher than for in-network providers, you still have the option to receive care from them.

What is an EPO?

On the other hand, an EPO plan operates in a more tightly controlled way. Under an EPO, you must seek medical services from providers within the plan's network unless it's a true emergency. EPOs typically do not cover any out-of-network services (again, with the exception of emergency services). You may be responsible for the full cost if you choose to receive care outside of the network for non-emergency situations.

However, if you don't anticipate the need to visit specialists who might be out of network, or your healthcare needs are more infrequent, EPOs often have much lower monthly premiums than PPOs. For instance, let's say you visit the doctor once or twice per year, and if you need to visit a specialist, your doctor refers you. In this case, an EPO plan might be preferable as it'll be much less expensive month to month, and you're visiting a specialist because your doctor recommended it.

Cost Considerations

Both PPOs and EPOs have their own unique cost considerations. PPOs generally have higher monthly premiums and out-of-pocket costs in exchange for increased flexibility and coverage for out-of-network services. EPOs tend to have significantly lower monthly premium fees and lower out-of-pocket costs. The calculation you'll likely want to make should likely reflect:

  1. How often you anticipate the need to see doctors other than your primary care physician. If you have chronic conditions and need to see doctors that are out of network, a PPO might be worth the extra cost.

  2. Your general utilization of the healthcare system. If you visit the doctor infrequently, the reduced cost you encounter each month for premiums likely makes an EPO a more attractive option.

Making the Right Choice

Choosing between a PPO and an EPO ultimately depends on your individual needs and preferences. If you highly value the freedom to choose your healthcare providers and are willing to pay higher premiums for that flexibility, a PPO plan may be the better option for you. On the other hand, if this isn't a primary concern for you, an EPO plan may suit your needs better.

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