How do Preferred Provider Organizations (PPO) differ from HMOs?

Preferred Provider Organizations (PPOs) differ from Health Maintenance Organizations (HMOs) primarily in their structure and flexibility regarding healthcare providers. One of the main characteristics of PPOs is that they negotiate fees with a network of healthcare providers to offer discounted rates to their members, allowing them more choices for services than an HMO, which typically has a more restricted network of providers.

The key aspect that makes the chosen answer correct is that PPOs do not control the service facilities where the healthcare is provided. Instead, they offer an arrangement where members are encouraged to use preferred providers within the network for lower costs but have the freedom to seek care outside that network, albeit often at a higher out-of-pocket expense. This feature grants members greater flexibility and autonomy in selecting their healthcare services compared to HMOs, which usually require members to stay within their network for all services.

In contrast, the other listed choices suggest characteristics that do not accurately describe PPOs. For example, requiring a primary care physician and gatekeeping processes are hallmarks of HMOs rather than PPOs, where members can access specialists without referrals. Additionally, while PPOs can cover emergency services, they are not exclusively limited to those, and their coverage extends to a wide range of healthcare services,