Preferred provider organizations: today's models and tomorrow's prospects

Preferred provider organizations (PPOs) have recently attracted much attention as an alternative to both traditional fee-for-service medicine and health maintenance organizations. To examine their development and structure, we conducted a telephone survey with executives of more than 130 operational PPOs. We describe typical examples of the three most common types of PPOs-those sponsored by providers, insurers, and entrepreneurs-and identify problems each faces in the increasingly competitive health care environment. We then cite approaches that innovative PPOs are using to deal expressly with these problems.