Medicare Part C (Medicare Advantage) Explained

Types of Medicare Advantage Plans

Medicare Advantage Plans can be:

• Health Maintenance Organizations (HMO)
• Preferred Provider Organizations (PPO)
• Private Fee-for-Service Plans (PFFS)
• Point of Service (POS) Plans
• Provider Sponsored Organizations (PSO)
• Medical Savings Account (MSA) Plans
• Special Needs Plans (SNP)

Health Maintenance Organizations (HMO) – A type of Medicare Advantage Plan that is available in some areas of the country. Plans must cover all Medicare Part A and Part B health care. Some HMOs cover additional benefits, like extra days in the hospital. In most HMOs, you can only go to doctors, specialists, or hospitals on the plan’s list, except in an emergency, and are typically required to obtain a referral from your Primary Care Physician before seeing a specialist. Your costs may be lower than in Original Medicare.

Preferred Provider Organizations (PPO) – A type of Medicare Advantage Plan in which you pay less if you use doctors, hospitals, and providers that belong to the network. You can use doctors, hospitals, and providers outside of the network for an additional cost. Referrals are not necessary to see a specialist.

Private Fee-for-Service Plans (PFFS) – A type of Medicare Advantage Plan in which you may go to any Medicare-approved doctor or hospital that accepts the plan’s payment. The insurance plan, rather than the Medicare Program, decides how much it will pay and what you pay for the services you get. You may pay more or less for Medicare-covered benefits. You may have additional benefits Original Medicare doesn’t cover.

Medical Savings Accounts (MSA) – Medicare MSA Plans have two parts: a high deductible health plan and a bank account. Medicare gives the plan an amount each year for your health care, and the plan deposits a portion of this money into your account. The amount deposited is less than your deductible amount, so you will have to pay out-of-pocket before your coverage begins.

Point of Service (POS) Plans – An HMO option that lets you use doctors and hospitals outside the plan for an additional cost.

Provider Sponsored Organizations (PSO) – Plans run by a provider or group of providers. In a PSO, you usually get your health care from the providers who are part of the plan.

Special Needs Plans (SNP) – A special type of plan that provides more focused health care for specific groups of people, such as those who have both Medicare and Medicaid, who reside in a nursing home, or who have certain chronic medical conditions.

How Much Do Medicare Advantage Plans Cost?

The out-of-pocket costs for a Medicare Advantage Plan vary widely, and depend on the following:

• Whether the plan charges a monthly premium in addition to your Part B premium.
• Whether the plan pays any of the monthly Part B premium.
• Whether the plan has a yearly deductible or any additional deductibles.
• How much you pay for each visit or service (copayments).
• The type of health care services you need and how often you get them.
• Whether you follow the plan’s rules, like using network providers.
• Whether you need extra coverage and what the plan charges for it.
• Whether the plan has a yearly limit on your out-of-pocket costs for all medical services.

A few Medicare Advantage plans may pay all or part of your Part B premium. (You still get all Part A and Part B covered services). Your Medicare Advantage plan premium may also include all or part of the premium for Medicare prescription drug coverage (Part D).

If you have limited income and resources, you may qualify for the following:

• Extra Help paying for your Part D premium and other prescription drug coverage costs.
• Help from your state to pay your Part B premium.

How to Enroll in and Switch Medicare Advantage Plans?

You can join, switch, or drop a Medicare Advantage Plan at these times:

• When you first become eligible for Medicare (the 7-month period begins 3 months before the month you turn age 65, includes the month you turn age 65, and ends 3 months after the month you turn age 65).
• If you get Medicare due to a disability, you can join during the 3 months before to 3 months after your 25th month of disability. You will have another chance to join 3 months before the month you turn age 65 to 3 months after the month you turn age 65.
• During the Annual Election Period between October 15-December 7. Your coverage will begin on January 1 of the following year, as long as the plan gets your enrollment request by December 31.

Medicare Advantage enrollees have an annual opportunity to prospectively disenroll from any Medicare Advantage plan and return to Original Medicare between January 1 and February 14 of every year. This is known as the Medicare Advantage Disenrollment Period (MADP). Disenrollment requests received during this MADP will be processed for the first of the following month. Regardless of whether the MA plan included Part D drug coverage, MA enrollees using the MADP to disenroll from MA from January 1 through February 14 are eligible for a Special Election Period (SEP) to enroll in a Prescription Drug Plan (PDP) and may request enrollment in a PDP during the same time frame. This does not apply to members of Private Fee-For-Service Medicare Advantage-Only (PFFS MA-Only) plans who are also enrolled in separate prescription drug plans (PDPs). An individual may use this SEP to request enrollment in a PDP subsequent to having submitted a disenrollment request from the MA plan during the MADP or may simply request enrollment in the PDP, resulting in automatic disenrollment from the MA plan. Individuals enrolled in MA-only PFFS plans must request disenrollment from the MA-only plan in order to be eligible for this SEP, as enrollment in a PDP will not result in automatic disenrollment from the MA-only plan.

In most cases, you must stay enrolled for that calendar year starting the date your coverage begins. However, in certain situations, you may be able to join, switch, or drop a Medicare Advantage Plan at other times. This is referred to as a Special Election Period (SEP). For a full list of qualifying circumstances, please visit Medicare.gov. Some of these situations include the following:

• If you move out of your plan’s service area
• If you moved to a new address that is still in your plan’s service area, but have new plan options in your new location
• If you have both Medicare and Medicaid
• If you qualify for Extra Help to pay for your prescription drug costs
• If you live in an institution (like a nursing home)