In addition to Medicare Supplemental Insurance, Medicare offers several different options for your evaluation. The original Medicare Plan is a fee-for-service plan that covers an abundant variety of health care services and certain prescription drugs. You may choose from any doctor or hospital who accepts Medicare’s payment for services rendered.
Do not make any changes to your present coverage if you currently are covered by an employer, trade union, Department of Veterans Affairs, TRICARE, a special program or a Medicare supplemental policy until you talk to a benefits administrator, the insurer or a licensed plan provider.
Before you choose your Medicare coverage you should consider the plan’s cost, benefits, choice of doctors and hospitals, location of facilities (how close are they to your home, their hours, acceptance of new patients and how will they assist you should you require medical attention outside of the state or even the country. What about the types of prescription you may need, are they included on the plan’s formulary? Pharmacies can be another issue. How close are they to you and can you order by calling them? Finally, is the quality of the plan you select going to meet the expectations that you have grown to expect from your previous or current health care coverage.
If you need it, there are several places where you can get help choosing the health care plan and prescription drug coverage that will work best for you. Visit www.medicare.gov or call 1800 633 4227 to speak with a service representative. They will mail you the information you need usually within three weeks. You can also call your State Health Insurance Assistance Program for assistance.
Medicare Supplemental Insurance Alternatives
Besides Medicare supplemental policies, there are other options that can either supplement or replace your Original Medicare. These other plan options include:
- Medicare HMO (Health Maintenance Organization) Plans
- Medicare PPO (Preferred Provider Organization) Plans
- Medicare Special Need Plans
- Medicare PFFS (Private Fee for Service) Plans
- Medicare Cost Plans
- PACE (Programs of All-inclusive Care for the Elderly)
If any of these types of other Medicare plans are available where you live and you have Medicare Part A and Part B, any of the plans above will give you Medicare covered benefits. If you have a Medicare HMO and only part B you may stay in your plan. There will be a monthly payment for the extra insurance and prescription drug plan.
If you join any of these other Medicare plans you are still in the Medicare program and have the same rights and protections. You will still receive all the regular Medicare covered services. If you are in any Medicare Advantage Plans or other Medicare health plans, you may be able to get prescription drug coverage through the plan. If you have a Medicare PFFS or Cost Plan you can still join a Medicare Prescription drug plan. You may be eligible for extra benefits such a vision, hearing, dental and health benefits. You might have to see doctors that belong to the plan to obtain treatment. Your monthly premium depends on the plan’s monthly costs and you may have some out of pocket expenses. If you have to pay co-payments for services, these expenses are typically lower than the original Medicare Plan.
Medicare Advantage Plans
The first four plan types listed below fall under the classification of Medicare Advantage Plans. Medicare Advantage plans are health insurance options that are regulated by the federal government but managed by private health insurance companies. Any private health insurance company wishing to market Medicare Advantage plans must be approved and authorized to do so by Medicare. When you join a Medicare Advantage plan, all of your Medicare eligible health care needs are provided through that health plan. Types of Advantage plans include HMO plans, PPO plans, Indemnity (fee-for-service) plans and plans for people with special needs. To enroll in a Medicare Advantage plan you will need to already be enrolled in both Medicare Part A and Part B and will be required to continue paying your Part B premium.
Since Medicare Advantage plans are administered through private health insurance companies, you may be required to use only physicians within the Medicare network of that insurance company. This depends on the type of Advantage plan that you select. Advantage HMO plans require you to choose a primary care physician who will manage your health care needs and refer you to specialists within his medical group. Medicare Advantage Plans, even though they are regulated by Medicare, will typically provide you with better coverage than original Medicare. This may include lower co-payments for office visits, lower deductibles for hospitalization and prescription drug coverage. In most cases, a Medicare Advantage plan will provide you with Medicare Part A, Part B and Part D benefits, all in one plan. Because they are a combination of the three Medicare Plans, a Medicare Advantage plan is often referred to as Medicare Part C.
Under a Medicare Advantage plan, the private health insurance company that manages your plan is paid a monthly fee by Medicare. That private insurance company than assumes the risk of maintaining your health care and paying any claims associated with your medical treatments. This may seem like a risky undertaking to an insurance company, but they receive the monthly compensation for all Medicare Advantage members under their plan, even if those members have no claims during that month.
Medicare HMO (Health Maintenance Organization) Plans
This HMO plan has a network of doctors and hospitals that are members of the HMO plan. You must seek services from a doctor or hospital that is on the HMO list. When you join a Medicare HMO plan, your health insurance company will provide you with a list of doctor’s and hospitals that accept patients under this plan. Before choosing a Medicare HMO plan, you might first check with your doctor to see which, if any, Medicare HMO plans he contracts with.
If you join an HMO plan you may be asked to choose a primary care doctor. This is the doctor you will see for the majority of your health care. If you need a specialist your primary care doctor will send to him. Ask your HMO plan for the names of doctors in your area if you want to change your primary care physician. Doctors can join or leave Medicare HMO plans at anytime. If your primary doctor should leave, your plan will let you know in advance and give you a chance to choose a new doctor.
If you obtain health care outside of the plan’s Network you will usually have to pay for these services. In some cases, neither the Original Medicare Plan nor the HMO plan will pay for these services and you will be responsible for all of the medical expenses.
Medicare HMO plans are usually restricted to a specific service area. This geographic boundary is where the plan services are provided and where members are accepted. You may be covered if you need emergency treatment or urgent care and aren’t in your HMO’s service area.
You will need a referral to see a specialist. A referral is a written OK from your primary care physician to see a specialist to get special care. If you are a woman, you can go once a year without referral for a mammogram and every other year for other women’s care services as outlined by Federal and state health insurance regulations. There are special rules for some of the services if you are a woman and need women’s care services and the type of services you require are not available, the plan will arrange for care outside the network.
Some Medicare HMO Plans offer a Point of Service option that lets you go to doctors and hospitals that aren’t a part of the network. This option can mean a substantial increase to your monthly premium.
Medicare PPO (Preferred Provider Organization) Plans
These Medicare plans use many of the same rules outlined in the area above that pertains to Medicare HMO plans. However, with a PPO you can see any doctor that accepts Medicare. You will not need a referral from a primary care physician to see a specialist or other provider outside of the health plan’s network. If you go to the hospital or see a doctor out of the network you will probably have additional out-of-pocket expenses for your health care. You may want to contact the plan to see if you will have to pay more and to determine if the service you need is covered. Usually, you can get more benefits at a lower cost than Original Medicare Plan. PPO plans must pay for all services that are covered services you obtain out of network. Every plan is different and the out of pocket expenses may vary.
Starting in 2006 in most parts of the country, regional Medicare PPO Plans will be available to provide you with more choices for Medicare health insurance coverage. While regional PPO Plans serve an entire region, they can be a single state or expand into a many state area. Medicare PPO Plans enable members to get their Medicare prescription drug coverage. In a regional PPO there is the added protection for Medicare Part A and Part B. There is a limited out of pocket cost and this cost will depend on the plan.
Medicare Special Needs Plans
In 2005, Medicare Health plans started offering what they call “Special Needs” plans. These plans may restrict all or most of their membership to certain persons. This can include those in a long term care facility such as a nursing home, persons eligible for both Medicare and Medicaid or persons with certain chronic or disabling illnesses. These plans are not available in most areas and are designed to provide Medicare health care to people who qualify. For example, for people with diabetes might have additional providers that specialize in diabetes and can offer special education or counseling, exercise or nutrition programs that are designed to improve and control the condition.
Medicare PFFS (Private Fee-For Service) Plans
Medicare PFFS plans are yet another type of Medicare plan that is offered by private companies. With this type of plan you can use any Medicare approved doctor or facility that complies with the terms of your plan’s payment. You may get extra benefits, such as extra days in the hospital if needed. The private company decides how much it will pay and what services you will require. Medicare does not factor in the decision. You can get your Medicare prescription drug coverage for the plan if it is offered, or you can join the optional Medicare prescription drug plan to add coverage if drug coverage is not offered by the Medicare PFFS plan.
Medicare Cost Plans
These plans are not available in all areas of the country and have similar rules to those that apply to Medicare HMO plans. If you use a non-network provider, the eligible medical services are covered under the Original Medicare Plan. You will need to pay the Medicare Part A and Part B coinsurance and deductibles that apply to the health care services that are performed.
Medicare Cost Plans may have periodic enrollment periods, so you will need to join a Medicare Cost plan whenever it is accepting new members. You can leave a Medicare Cost Plan whenever you choose and return to the Original Medicare Plan. You can obtain your Medicare prescription drug coverage from the Cost Plan if it is offered. If it is not offered, you may choose to buy a separate Medicare Prescription Drug Plan.
PACE (Program of All-inclusive Care for the Elderly)
PACE plans are offered in some states as an option under Medicaid. The Program of All-Inclusive Care for the Elderly (PACE) is a capitated benefit authorized by the Balanced Budget Act of 1997 that features a comprehensive service delivery system along with integrated Medicare and Medicaid financing. The PACE model was developed to address the needs of long-term care clients, providers, and payers that permits them to continue living at home while receiving medical services rather than be institutionalized. Capitated financing gives the medical providers the ability to deliver all medical services needed by the participants, rather than be limited to those provided under Medicare and Medicaid fee-for-service systems.
The PACE model enables certain states to provide PACE services to Medicaid beneficiaries as a state option. Eligible participants must be a minimum of 55 years of age, live in a PACE service area, and be certified as eligible for nursing home care by the appropriate State agency. For those that are eligible and enroll in this program, the PACE program becomes the sole source of services for Medicare and Medicaid eligible enrollees.
PACE authorized physicians and medical facilities receive monthly Medicare and Medicaid capitation payments for each eligible enrollee. Medicare eligible participants who are not eligible for Medicaid pay monthly premiums equal to the Medicaid capitation amount but are not required to pay deductibles or coinsurance.