What Is the Difference Between EPO & PPO in Blue Cross of California

Within the managed health care industry, delivery systems operate out of a network of service providers that contract with individual insurance companies. Blue Cross of California carries a broad range of insurance health plans, two of which are the EPO and PPO plans. The differences between these plans have to do with how services are delivered and who pays for them.

EPO Plans

• EPO plans, also known as Exclusive Provider Organizations, consist of small networks of doctors and facilities. Primary care physicians manage all aspects of a patient's medical care and handle the referral process when a specialist's care is needed, according to Mama's Health, a health care reference site. EPO plans carry a lifetime policy maximum in terms of how much they will pay out over the course of a patient's lifetime. Because of the way these networks are set up, EPO plans can offer large discounts on overall medical costs. However, they require patients to stay within the network in order for services to be covered; otherwise, patients pay the total costs for any care received outside the network.

PPO Plans

• PPO plans, also known as Preferred Provider Organizations, consist of larger networks than those offered by EPO plans, according to BenefitsCafe, a health plan resource site. In this type of plan, patients must choose a primary care physician from within the network, who will coordinate all aspects of the patient's care. PPO plans cover the costs for services received outside of the provider network; however, patients will pay more out-of-pocket expenses when going outside of network. As with any managed care network, the reduced costs only apply with network providers who've contracted with a patient's insurance company.

Provider Coverage Differences

• PPO plans provide more flexibility in terms of coverage for different types of services when compared to EPO plan coverages, according to Mama's Health. In addition, unlike EPO plan requirements for a referral to a specialist, patients under PPO plans can seek a specialist's care without a primary care physician's referral. Another big difference between EPO and PPO plans has to do with maternity coverage. For example, EPO plans typically cover the costs of delivering a baby, whereas PPO plans do not.

Out-of-Pocket Expenses

• PPO plans carry a large calendar-year deductible that must be paid before plan coverages actually pay for medical costs; however, monthly premium costs are relatively low compared to EPO plans, according to BenefitsCafe. Once the deductible amount has been paid, PPO plans cover 100 percent of covered expenses for the remainder of the calendar year. In the case of family PPO plans, each course of treatment received by any one family member works off of the same deductible as opposed to EPO plans--where each family member has his own deductible amount to cover.