What is a distinguishing feature of a PPO plan compared to an HMO plan?

PPO plans, or Preferred Provider Organizations, are distinct from HMO plans, or Health Maintenance Organizations, primarily due to their flexibility in provider choice. One of the key features of PPO plans is the allowance for members to seek care from out-of-network providers, albeit typically at a higher out-of-pocket cost than if they choose in-network providers. This provides members with greater flexibility and autonomy in making healthcare decisions, as they do not have to rely solely on a predetermined network of doctors.

In contrast, HMO plans generally require members to select a primary care physician (PCP) who oversees their care and coordinates referrals to specialists. This referral process can limit the immediacy of accessing specialist care without prior approval. Additionally, HMO plans typically do not cover services from out-of-network providers, except in emergencies.

The other options presented do not accurately reflect the characteristics of PPO plans. Specifically, PPO plans do not require referrals for specialists, usually have out-of-pocket maximums to limit members' annual expenses, and while they can encourage the use of network providers through lower costs, they do not exclusively use them. Thus, the ability to use out-of-network providers is a defining feature that distinguishes PPO plans from HMO plans.