Medicare Advantage: How Does It Relate?
By: Source: AARP.org Date Posted: 2006-10-06 16:28:31.376111-04:00
In December 2003, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 was signed into law. This law makes major changes to Medicare, the nation's health insurance program for people age 65 and over and some persons with disabilities. One of these changes includes altering the program that deals with private health plans in Medicare, known as Medicare+Choice.
Medicare Part C, the Medicare+Choice program, is being renamed Medicare Advantage. Medicare Advantage is a way to get Medicare coverage through a private health plan. These plans may be less expensive than original Medicare, and they may offer some benefits that are not covered by Medicare. Medicare Advantage plans are very similar to Medicare+Choice plans.
They may be a:
- Health Maintenance Organization (HMO)
- Point-of-Service (POS) plan
- Private Fee-For-Service (PFFS) plan
- Local Preferred Provider Organization (PPO)
Although each type of Medicare Advantage plan differs, they have certain features in common:
- The plan is run by a private company.
- The amount of money that the company gets from the government for your care is set, no matter how many or how few services you use.
- The private company decides the rules for covering your benefits and payment. Each year, it can change benefits, premiums and other costs to you.
- Each year, the private company decides whether or not to offer a Medicare Advantage plan.
- Each year, you can decide whether to stay in your plan, switch to another, or return to traditional Medicare.
- Starting January 1, 2006, all companies offering Medicare Advantage plans except Private Fee-For-Service plans must offer at least one plan with drug coverage. If you select a Private Fee-For-Service plan or a Medicare Advantage plan without drug coverage, you may select a Medicare drug benefit plan in your area.
There are some differences among Medicare Advantage plans, and the plans may vary widely. In some plans, you can pick your doctors only from the plan's network. In others, you can either choose doctors from in-network, or you can go outside the network. Some of the plans pay only for in-network care, while others will pay for care both in- and out-of-network. Generally, going out-of-network costs more. Remember, no one has to enroll in a Medicare Advantage plan. You can stay in the traditional Medicare program.
For More Information
Medicare will give you more information as the benefits start. Visit the Medicare Web site or call toll-free 1-800-MEDICARE (1-800-633-4227 or TTY 877-486-2408). If you prefer to get help in person, there are counseling programs that can provide direct assistance.
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