On a health insurance “scale”, PPO insurance lies between HMOs and pure fee-for-service plans. Your health care is managed (and so restricted), but you are granted a degree of choice in providers. A PPO health insurance plan operates like an HMO in that you pay a fixed monthly premium, and, in return, the health insurance company and its health care network provide basic medical benefits to you.
However, a PPO does differ from the original HMO blueprint, primarily in that under a PPO insurance plan, a primary care physician or “gatekeeper” physician is not required. As a result, seeing a specialist does not require a referral.
If you need or want health care from outside the network, you should expect to pay a higher co-payment than if the provider were from within the PPO network.
In essence, each time you need medical attention, you can decide between an higher costing indemnity plan with total freedom of choice over care or a lower costing HMO plan that restricts your care to within a network.