What distinguishes a PPO from an HMO?

A PPO, or Preferred Provider Organization, is characterized by its flexibility in choosing healthcare providers and the ability to receive care outside of a network, although this may come with higher costs. Unlike HMOs (Health Maintenance Organizations), which typically require members to choose a primary care physician and obtain referrals for specialist services, PPOs allow individuals to seek care from any provider without such restrictions.

The option indicating that PPOs offer limited benefits for out-of-network services captures a key distinction. While PPOs do provide the option to see out-of-network providers, they incentivize the use of in-network providers by offering greater coverage and lower out-of-pocket costs. This suggests that while care can be sought elsewhere, the financial implications can discourage members from doing so.

In contrast, the other options focus on aspects that are typical of HMO plans rather than distinguishing features of PPOs. For instance, PPOs do not require a primary care physician or mandate referrals, allowing for greater autonomy in managing one's healthcare. Additionally, they do allow out-of-network care but usually at a reduced benefit level compared to in-network services. Thus, the option indicating limited benefits for out-of-network services represents a correct and crucial understanding of PPOs.