Companies offer different types of Medicare Advantage Plans – also referred to as Medicare Part C or MA Plans. Private companies offer these plans to seniors and qualifying members. MA Plans provide cost-effective and more comprehensive coverage than Original Medicare. Understanding the different types of Medicare Advantage Plans will help you decide which plan is best for your budget and your individual health care needs.
Medicare Advantage plans are offered through private insurance companies and are regulated by the Centers for Medicare and Medicaid Services. While Original Medicare covers the services that a Medicare beneficiary receives from doctors or healthcare facilities that accept Medicare, Medicare Advantage plans give their members a specific network of providers and healthcare facilities from which they can receive services. Those who enroll in Medicare Advantage plans are still required to pay their Part B premium, as well as any premium they may have for their Medicare Advantage plan.
Benefits, costs and plan availability will vary by insurance company and location. In addition that may also be a variety of different MA plans available to you in your service area. Some of these plan types can include:
- Health Maintenance Organization plans (HMO)
- Preferred Provider Organization (PPO)
- HMO Point of Service plans (POS)
- Private Fee-For-Service plans (PFFS)
- Special Needs Plans (SNP)
- Medical Savings Account Plans (MSA)
Understanding all of your options when it comes to Medicare Advantage plans will help you to be a better-informed consumer as you consider the type of coverage that may work best for your healthcare needs.
Different Types of Medicare Advantage Plans
HMO Plans – Health Maintenance Organization
As a general rule, you will be required to receive your medical care and health-related services from providers that exist within the plan’s network, with some exceptions. Exceptions to this rule include:
- Emergency care
- Urgent care that is outside of your service area
- Dialysis treatments that are outside of your service area
For your regular care, you may be required to choose a primary service provider from a list of doctors within the plan’s network. If you need to see a specialist, you will need to get a referral from your primary care physician. However, standard annual procedures such as mammograms will not require a doctor’s referral.
Some HMO Medicare Advantage Plans allow you to seek services from a provider that is not in their network. These are HMO Plans with a POS option (point of service). In these cases, out-of-pocket expenses may be higher.
Prescription drugs are generally covered with an HMO plan, but be sure to check in with a licensed Medicare agent to be sure.
PPO Plans – Preferred Provider Organization
PPO MA Plans are similar to HMO Plans in that they have a network of service providers. However, PPO Medicare Part C plans are generally more lenient about allowing you to choose any care provider – whether in or out of their immediate network. Like HMO plans, though, you may pay more for an out-of-network healthcare provider.
When comparing HMO and PPO coverage, there are two other significant differences between these types of Medicare Advantage Plans. The first is that you will not be required to choose a primary care provider in a PPO MA Plan. The second is that you will not need to seek a doctor’s referral when you are in need of a specialist.
If you anticipate needing prescription drug coverage, it’s important to make sure either your HMO or your PPO MA Plan includes this option. While enrolled in one of these plans, you will NOT have the option to sign up for Medicare Part D.
PFFS Plans – Private Fee-for-Service
Private Fee-for-Service Plans are types of Medicare Advantage Plans that have a predetermined amount they will pay for any given doctor/hospital visit or medical procedure. Some PFFS Plans have a network of service providers. Others simply offer a general outline of their payment terms. In this case, you should contact the provider from whom you would like to receive services to see if they accept your coverage. The provider has the right to deny care if they do not agree to the payment terms outlined in your PFFS plan. The only exception to this rule is in the event of an emergency.
It’s important to remember that any copayment you owe will be due at the time healthcare services are rendered. It’s important for you to always have your insurance identification card with you and budget for the type of care you’re receiving.
This is a popular option for individuals who have minimal health issues and who do not foresee the need for extensive medical care.
SNPs – Special Needs Plans
SNPs are types of Medicare Advantage Plans that are reserved for people with pre-existing conditions. SNPs are also available to individuals who are institutionalized or qualify for both Medicaid and Medicare.
Most chronic conditions meet the criteria for enrollment into an SNP Medicare Part C Plan. Special Needs Medicare Advantage Plans are tailored to suit the needs of individuals based on standard medical requirements of each qualifying chronic condition.
In an SNP Plan, you will be required to choose a primary care physician or at least work with a dedicated care coordinator. You will also be limited to doctors and health care providers within the established network. In order to see a specialist, you will need a doctor’s recommendation. All SNP Plans offer mandatory prescription drug coverage.
In the case of an emergency, you may seek care outside of the established network. Also, if you have ESRD (End Stage Renal Disease) and require dialysis, treatments outside of your coverage area will be allowed.