Definition
Preferred Provider Network (PPN)
A Preferred Provider Network is a subset of network hospitals that have agreed package rates with insurers for common procedures.
PPN hospitals contract with insurers or TPAs to provide specified surgeries, such as cataract or joint replacement, at pre-negotiated package rates, controlling cost inflation and standardising charges. Treatment at a PPN hospital ensures rates are fixed in advance.
For certain procedures, insurers may insist on PPN package rates and limit reimbursement to those rates even at non-PPN hospitals. PPNs help curb the wide variation in Indian hospital pricing and reduce disputes over inflated bills at claim time.
Related terms
- Network HospitalA network hospital is a healthcare provider that has a tie-up with the insurer or TPA to offer cashless treatment to policyholders.
- Third-Party Administrator (TPA)A Third-Party Administrator is an IRDAI-licensed intermediary that processes health insurance claims and manages cashless services on behalf of insurers.
- Package RateA package rate is a pre-agreed all-inclusive charge for a specific medical procedure negotiated between insurers/TPAs and hospitals.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.