What is a primary feature of Preferred Provider Organizations (PPOs)?

The primary feature of Preferred Provider Organizations (PPOs) is that they offer health care at rates approved by the insurer. This means that PPOs negotiate contracts with specific healthcare providers to create a network of preferred providers. These providers agree to deliver services at discount rates, which helps keep the costs manageable for both the insurer and the insured. Enrollees in a PPO plan benefit from lower out-of-pocket expenses when they utilize these preferred providers.

In contrast, other options imply features that do not align with the general operations of PPOs. Referrals to specialists are typically more characteristic of Health Maintenance Organizations (HMOs), where a primary care physician coordinates care. The claim that PPOs operate without network restrictions is inaccurate because they do have a network, though they allow for some flexibility to see out-of-network providers at a higher cost. Lastly, stating that PPOs exclusively provide services through hospital systems is misleading as they can contract with various healthcare providers, including independent doctors and clinics, not just hospitals.