Medicare Advantage Plans: 6 Types to Know

Medicare enrollees have more options than ever. For the 2020 coverage year, there will be an average of 39 Medicare Advantage plans in each county. That’s a lot of plans for people to choose from. These plans are not all the same – there are significant differences between them. In order to pick the plan that best meets your needs, it’s important to understand these differences.

Six Plan Types

Medicare Advantage plans can be broken down into six basic types:

  • Health Maintenance Organization (HMO) plans: These plans use a network of providers and hospitals. If you go to a provider or hospital that is not in the plan’s network, the services might not be covered. However, emergency care, out-of-area urgent care and out-of-area dialysis will be covered. You will generally need to choose a primary doctor, and you may need to get a referral to see a specialist.
  • HMO Point-of-Service (HMOPOS) plans: These plans are similar to other HMOs, but you can get some services out-of-network, although you will have to pay a higher out-of-pocket copay or coinsurance amount.
  • Preferred Provider Organization (PPO) plans: These plans have a network of providers and hospitals. You can see a provider or go to a hospital outside of the plan’s network, but you will have higher out-of-pocket costs when you do so. Emergency and urgent care are always covered. You generally won’t need to choose a primary care doctor or get a referral to see specialists.
  • Private Fee-for-Service (PFFS) plans: These plans allow you to see any provider who accepts Medicare. The plan may also have a network of providers you can see. If you see an out-of-network provider who has agreed to the plan’s terms, you may pay more. You do not have to choose a primary care doctor or get a referral to see a specialist.
  • Medical Savings Account (MSA) plans: These plans come with a high deductible, meaning you’ll have to pay more out of pocket before coverage kicks in. However, to help make up for the high deductible, these plans also come with a bank account. The plan deposits money into this account, which you can then use to pay for your health care during the year. These plans do not include prescription drug coverage.
  • Special Needs Plans (SNPs): You cannot join an SNP unless you meet the eligibility requirements for joining. Some SNPs are designed for people who are dual eligible for Medicare and Medicaid. Others are designed for people who live in nursing homes or other institutions. The rest are tailored to meet the needs of specific chronic conditions. For example, one SNP might be designed for people with chronic heart failure, and another might be designed for people with neurologic disorders. If you have a chronic condition, you can see whether there is an SNP for it in your area.

Other Differences to Consider

In addition to different plan types, its important to consider the benefits provided under each plan.

Medicare Advantage plans provide coverage for the services covered under Original Medicare (Medicare Parts A and B). Some also offer additional benefits. These benefits often include hearing, dental and vision benefits. Other benefits may also be available.

Many Medicare Advantage plans include prescription drug coverage, but some do not. If you select a Medicare Advantage plan that does not include prescription drug coverage, you will need to enroll in a separate Medicare Part D plan to obtain coverage. It’s important to consider this when you’re comparing your premium and out-of-pocket costs.

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Sources
  • https://www.cms.gov/newsroom/press-releases/trump-administration-drives-down-medicare-advantage-and-part-d-premiums-seniors

  • https://www.medicare.gov/sites/default/files/2019-09/10050-medicare-and-you.pdf

  • https://www.medicare.gov/sign-up-change-plans/types-of-medicare-health-plans/how-medicare-special-needs-plans-snps-work

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