What is a Medicare Advantage PPO?
Key Takeaways
- A Medicare Advantage PPO (Preferred Provider Organization) offers flexibility to see both in-network and out-of-network providers, typically without needing referrals or a designated primary care physician (PCP).
- PPO plans often cover additional services beyond Original Medicare.
- Costs are lower for in-network care and higher for out-of-network services.
- PPOs differ from HMOs by offering out-of-network coverage, usually no PCP requirement, and fewer restrictions on seeing specialists, though HMOs generally have lower costs.
- PPO plans are ideal for those who prioritize provider flexibility and broader access.
A Medicare Advantage PPO (Preferred Provider Organization) is a type of Medicare Advantage plan that offers flexibility in choosing healthcare providers. The most unique feature of this plan is that it allows members to see providers in and out of the network. Unlike other types of Medicare Advantage plans, PPOs do not require you to have a designated primary care physician (PCP), and some may not need referrals for you to see specialists.
Learn more about how PPO Medicare Advantage plans work, average costs, and how they compare to other options to help you determine if a PPO plan aligns with your healthcare needs.
PPO: A Medicare Advantage Plan Type
Medicare Advantage plans, or Medicare Part C, are private health plans approved by Medicare. These plans combine the benefits of Original Medicare (Part A and Part B) and often include additional coverage. Not all Medicare Advantage plans offer these specific benefits, so check plan details for more information.
Medicare Advantage plans are growing in popularity. In fact, 54% of eligible Medicare beneficiaries enrolled in Medicare Advantage in 2024. PPO plans make up a significant portion of this enrollment due to their flexibility in provider choice.
How Do Network Plans Work?
A network refers to a group of doctors, hospitals, and healthcare providers who contract with an insurance company to provide care at reduced rates. Medicare Advantage plans typically use these terms to indicate level of coverage:
- In-network care: Providers within a Medicare Advantage plan’s network agree to the plan’s terms and payment for services. You pay less for services when you see an in-network doctor.
- Out-of-network care: Providers who have not agreed to participate in the plan’s network are considered out of network. You may still receive care outside the network if your plan has out-of-network benefits as PPO plans do, but it often comes with higher costs.
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Understanding the Medicare Advantage PPO
A PPO Medicare Advantage plan is a flexible option for beneficiaries who want the freedom to choose their healthcare providers without needing referrals to see specialists in some cases and without needing to select a specific doctor to be their primary care physician. PPO plans also allow for out-of-network care, though costs are typically higher when you go outside the plan’s network.
Medicare Advantage PPO plans come in two main types:
- Local PPO: This type of PPO covers specific geographic areas like cities or counties. Local PPOs generally have smaller networks.
- Regional PPO: This type of PPO covers large multi-state regions and is designed for individuals who need broader provider access, such as those living on state borders or who travel often.
Both plan types follow similar rules but differ in network size and geographic coverage.
Key Features of Medicare Advantage PPO Plans
- Flexible provider choice: Visit any provider, in network or out of network, without needing referrals.
- Lower costs for in-network care: You pay less for services provided within the network.
- Out-of-network coverage: PPOs offer coverage outside the network but often at a higher cost.
- No primary care physician (PCP) requirement: You are not required to designate a PCP.
- Prescription drug coverage: Most PPO plans include Part D coverage for prescription medications.
Costs for PPOs
- Premiums: The premium is the monthly fee you pay for the plan. Some Medicare PPOs feature a $0 premium, but you must still pay your Medicare Part B premium.
- Deductible: The deductible is the amount you pay out of pocket before the plan begins covering services. PPO deductibles may vary for in-network and out-of-network care. If your plan includes prescription drug coverage (Part D), it will likely have a separate deductible.
- Copayments: A copay is a flat cost for services, such as a $20 fee for a doctor’s visit. Copays are usually lower for in-network care. Keep in mind that your copay will differ based on your plan.
- Coinsurance: This is the percentage of the cost you pay for a service (e.g., 20%). Out-of-network coinsurance is often higher. Your PPO plan covers the remaining costs.
- Out-of-network fees: PPOs cover out-of-network care, but these services come with higher costs.
- Out-of-pocket maximums: The out-of-pocket maximum is the most you’ll pay for covered services in a year. For 2025, the limit for in-network care is $9,350, but out-of-network costs may push the total higher. Plans that offer prescription drug coverage have a separate out-of-pocket maximum for drugs. In 2025, this limit is $2,000.
See It in Action
Imagine Mary, a Medicare Advantage PPO plan member who needs care for a knee injury. She incurs the following costs while seeking treatment:
- Primary Doctor Visit: She visits an in-network primary care physician (PCP) and pays a $20 copay.
- Specialist Visit: She doesn’t need a referral and sees a specialist within her PPO plan’s network. She pays a $40 copay.
- Out-of-Network Care: While traveling, Mary’s knee injury flares up and so she sees an out-of-network doctor and pays 40% of the service cost as coinsurance.
This scenario highlights the flexibility of PPO plans, allowing Mary to receive care both in and out of her plan’s network, though at different costs. Keep in mind that these costs are only examples and your actual costs will vary.
Medicare Advantage PPO vs. HMO
| PPO | HMO | PFFS | HMO-POS | |
| Average premium | High | Low | High | Low |
| Average network size | Large | Moderate | Large | Large |
| Designated primary care physician | Not required | Required | Not required | Required |
| Referrals to seek specialist care | Not required | Required | Not required | Required |
| Out-of-network care coverage | Partially covered | Not covered | Covered | Partially covered |
While both PPOs and Medicare Advantage HMOs (Health Maintenance Organizations) are popular Medicare Advantage plan types, they differ significantly. Their key differences lie in the following:
- Provider flexibility: PPOs allow out-of-network care, while HMOs require you to stay within the network.
- Primary Care Physician (PCP): HMOs require a designated PCP but PPOs do not.
- Referrals: HMOs require referrals to see specialists. PPOs generally do not.
- Costs: HMOs typically have lower premiums and out-of-pocket costs than PPOs because they have more care restrictions.
With these key differences in mind, PPOs are best for individuals who value provider flexibility and are willing to pay higher costs for that freedom. On the other hand, HMOs may be a better fit for those who prioritize lower costs and don’t mind staying within a network.
Are Medicare Advantage PPO Plans Good for You?
There’s no one-size-fits-all answer when choosing a Medicare plan. A PPO Medicare Advantage plan may be a good fit if you:
- Want the accessibility to see out-of-network providers
- Prefer not having to get referrals for specialists
- Are comfortable with higher premiums or cost-sharing for broader provider access
However, a different plan choice, like an HMO, may be a better fit if you rarely need out-of-network care or want lower costs.
Enrolling in Medicare Advantage
Enrolling in a PPO Medicare Advantage plan involves evaluating your healthcare needs and comparing options. Follow these steps:- Assess your needs. Make a list of your preferred doctors, medications, and expected healthcare usage.
- Compare plans. Use Medicare’s Plan Finder tool or consult with a licensed insurance agent to compare PPO plans based on premiums, networks, and coverage. If there are specific doctors you prefer or benefits you need, make sure your PPO plan options can accommodate those preferences.
- Check eligibility and enroll. Ensure you’re eligible for Medicare Part A and Part B. If you are, you can enroll in a Medicare Advantage PPO during one of the following enrollment windows.
Enrollment Windows
- Initial Enrollment Period (IEP): Your first opportunity to enroll; this is a 7-month window surrounding your 65th birthday. Annual Enrollment Period (AEP): October 15-December 7 each year, when you can join or switch plans.
- Medicare Advantage Open Enrollment Period (MA OEP): Medicare Advantage plan members can make a one-time change to their coverage by dropping or switching their Medicare Advantage plans each year from January 1-March 31.
- Special Enrollment Period (SEP): This allows you to make changes throughout the year if you experience a qualified life event such as a permanent move or change in Medicaid eligibility. The window is specific to your situation but usually lasts 60 days from the time of the event.
Putting It All Together
A Medicare Advantage PPO offers flexible coverage, allowing you to see both in-network and out-of-network providers mostly without referrals. It’s ideal for those who value choice and don’t mind potentially higher costs for that flexibility.
By understanding the features, costs, and enrollment options, you can determine if a PPO Medicare Advantage plan meets your healthcare needs. If you need assistance, working with a licensed insurance agent can help you evaluate plans and choose the best option.
Sources
Medicare Advantage in 2024: Enrollment Update and Key Trends. KFF.org
Medicare & You 2025. Medicare.gov