Georgia Navigator Practice Exam

What is a Preferred Provider Organization (PPO)?

1. An organization providing unlimited healthcare services

2. A network allowing out-of-network services with higher costs

3. Only covers medical emergencies

4. Requires members to select a primary care provider

The correct answer is: A network allowing out-of-network services with higher costs

A Preferred Provider Organization (PPO) is characterized by its structure that offers a network of healthcare providers from which members can choose. One of the defining features of a PPO is that it allows members to seek care outside of its network, although doing so typically incurs higher costs compared to using in-network providers. This flexibility is an attractive aspect for many individuals, as it provides them with more choices in their healthcare decisions while still offering the incentive of lower out-of-pocket expenses when they utilize the network of preferred providers. The other options describe characteristics that do not align with the structure of a PPO. For example, including only medical emergencies does not encompass the full coverage offered by a PPO. Similarly, requiring a primary care provider is more indicative of Health Maintenance Organizations (HMOs), which have stricter care coordination rules compared to the more flexible nature of PPOs. Lastly, the idea of unlimited healthcare services does not accurately represent the reality of PPOs, as there are typically limits and cost-sharing measures in place.