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The litigation exposures posed by preferred provider organizations
Personnel
|August 8, 1984
Summary
Preferred provider organizations (PPOs) may lower healthcare costs but pose legal risks. Employers should understand the litigation risks associated with different PPO structures to mitigate potential anti-trust and malpractice issues.
Area of Science:
- Healthcare Law
- Risk Management
- Health Insurance
Background:
- Employee healthcare costs are rising, prompting benefits administrators to seek cost-containment strategies.
- Preferred Provider Organizations (PPOs) are increasingly favored for their potential to reduce healthcare spending and insurance premiums.
Purpose of the Study:
- To analyze the potential litigation risks for employers associated with Preferred Provider Organizations (PPOs).
- To differentiate the legal risks posed by various types of PPOs.
Main Methods:
- Legal analysis of anti-trust and medical malpractice risks.
- Examination of three PPO models: provider-based, payor-based, and interface PPOs.
Main Results:
- Certain PPO structures present significant litigation risks for employers.
- Provider-based, payor-based, and interface PPOs entail varying degrees of legal exposure.
Conclusions:
- Employers must carefully evaluate the legal implications of PPO selection.
- Understanding specific PPO structures is crucial for mitigating anti-trust and malpractice liabilities.