PPO Touts Higher Discounts


By Molly Mulebriar

My Chief of Staff was breathlessly awaiting my return from lunch today. “Guess what, I found a heretofore unheard of PPO network that has great discounts! We should contact them!”

“Show me the evidence” I demanded.

“Well, look at this print-out. I got it off their website”:

“While our PPO has grown to over 70,000 directly contracted providers including 40,000 physicians, 500 hospitals and 30,000 ancillary providers we continue to maintain a local approach through long-standing relationships we’ve established with many of our providers.”

“We believe these relationships enable us to offer a level of experience unparalleled.. These include the level of quality of our provider network and significant discounts extended by our professional healthcare partners from their normal retail charges – discounts which, many times, are higher than those offered by our competitors.”

“Hmmmmm, seems like you are on to something. Looks like they have every doctor and hospital in the world on their network. The fact their discounts are many times higher than offered by their competitors is compelling” I mused.

“But I have a few questions: (1) If almost every doctor and hospital are part of this network, where is the steerage and why would a provider agree to “discount” their services? (2) A discount off what? Egregious charge -master rates, or charges picked out of thin air by Timothy Leary?


(3) If PPO contracts are so secretive, how does this PPO know how their pricing compares to their competitor’s contracts?” (4) and finally, what is a “normal retail charge” that they allude to here?

“And one last thing, since neither you or I have ever heard of this PPO network, then probably most providers haven’t heard of them either.”

I instructed my valued Chief of Staff to continue her investigation and report back to me at Starbucks in the morning, over a double shot Bloody Mary followed by an aromatic black coffee chaser.