There are a number of Medicare Advantage plan options. In many markets there are several HMO and PPO plans as well as Private Fee For Service (PFFS) plans available. Of the HMO plans many are offered in various markets with $0 premiums. (Nope they can’t be called free.) Let’s focus today on the HMO plans and their variations. It’s important to have the full picture on these plan designs before selecting one so it is an appropriate choice for each end user.
The Medicare Advantage Prescription Drug (MAPD) plans regardless of their flavor, all change how Medicare pays for your care away from Medicare directly paying, instead to a private insurer with a contract to provide the services on behalf of Medicare paying for the care. They are required to provide no less than all benefits provided within Original Medicare. These private plans can additional provide enhanced benefits and services and are allowed to modify the cost sharing from how it is set up with Original Medicare. Just like with Original Medicare the beneficiary must still pay their Medicare Part B premiums monthly when they choose to take a Medicare HMO plan instead of Original Medicare to provide their coverage.
The HMO variation of MAPD plans are ones which typically combine the Medical and Drug benefits together. There are also a few HMO plans that are medical only, and should only be chosen when the beneficiary has other drug coverage from places such as the Veterans Administration or other similar plan, because when selecting a medical only plan it’s not possible to also purchase a Medicare drug plan to round out coverage. Thus if a beneficiary needs medical and drug coverage they need to select an MAPD plan with drug coverage which is how most HMO plans are set up.
The HMO plans have many restrictions that are not in place with the PPO or PFFS plans. These restrictions come in the form of networks and referrals most typically. These plans typically offer a very small network of providers who refer to one another on a regular basis and are typically affiliated with one or more hospitals. Depending on the plan it could be a series of Independent Physician Associations (IPA) where each IPA is tied to a specific hospital. In this scenario the beneficiary picks a Primary Care Physician (PCP) who oversees all care and refers within the IPA to specialists and uses the one hospital tied with the IPA for all care. Typically beneficiaries get all care within the IPA so it’s important to know if specialists important to the beneficiary are also in that IPA.
Other HMO models use a wider network with PCP control still. However there are a larger grouping of specialists and hospitals to support the network and beneficiary care. Still the PCP has specific referral patterns but can refer to other in-network providers. Note with the HMOs there is virtually never any coverage for out of network care, other than on an emergency basis, which means a true emergency.
What it boils down to regardless is that in an HMO plan you must stay within the network, which restricts your choice of doctors and hospitals where you can get your care without paying the full bill yourself. So if you must see a doctor who is not in the network think long and hard before taking one of the HMO plans just because they appear to cost less on a monthly basis, add up your out of network costs and factor them into the decision. In the end it boils down to personal choice of what type of care model best fits your needs.
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