A Medicare Advantage Plan (except for Private Fee for Service plans) is a type of managed-care health system involves a group of doctors, hospitals and other health care providers who have agreed to provide care to Medicare beneficiaries in exchange for a fixed amount of money from Medicare every month. Medicare Advantage Plans include:
- Health Maintenance Organizations (HMOs),
- Health Maintenance Organizations with Point of Service Option (HMO- POS),
- Provider Sponsored Organizations (PSOs), and
- Preferred Provider Organizations (PPOs).
Cost: The monthly Part B premium. Some plans charge an extra monthly premium. Your client may also pay the plan a co-payment per visit or service. With an HMO or PSO plan, your client will be responsible for all charges if they go out-of-network except for emergency services, urgent care, and out-of-area dialysis.
The choice of doctors and hospitals varies by the type of Medicare Advantage Plan. HMO and PSO plans are typically more restrictive; however, under a PPO plan, a person with Medicare may use doctors and hospitals outside of the plan’s network for an additional cost.
The person with Medicare Advantage receives all the Medicare Part A and Part B covered services. Many Medicare Advantage Plans offer additional benefits not covered under the Original Medicare Plan such as dental care, eyeglasses, and hearing aids.
And there are a few less-common types of Medicare Advantage coverage that may be available in your area:
- Medicare MSA plans combine a high deductible Medicare Advantage plan with a medical savings account. The plan deposits an amount annually into an account which can be used for medical expenses including the deductible. Any unused portion can be carried over to the next year. Once the deductible is met, the plan may pay 100% of covered expenses or there may be a coinsurance until the maximum out of pocket is met and then the plan will pay 100% of covered expenses. Preventive services may not be subject to the deductible and coinsurance. MSA plans do not have a provider network. MSA plan members can use any Medicare-approved provider.
- A Medicare SNP is a type of Medicare Advantage plan that is only available for certain Medicare beneficiaries such as those with both Medicare and Medicaid (or enrolled in a Medicare Savings Program), institutionalized beneficiaries or those with certain chronic conditions. Special needs plans may offer more focused and specialized health care as well as better coordination of care for these beneficiaries than other types of Medicare Advantage plans.
- PACE is a Medicare program for older adults and people over age 55 living with disabilities. This program provides community-based care and services to people who otherwise need nursing home level of care. PACE provides all the care and services covered by Medicare and Medicaid, as well as additional care and services not covered by either program.
Note: Medicare Supplement/Medigap Policies do not work with Medicare Advantage Plans.
Initial Coverage Election Period (ICEP) is the period during which an individual newly eligible for MA may make an initial enrollment request to enroll in an MA plan. This period begins three months immediately before the individual’s first entitlement to both Medicare Part A and Part B and ends on the later of:
- the last day of the month preceding entitlement to both Part A and Part B or
- the last day of the individual’s Part B initial enrollment period.
People with Medicare can also enroll in a Medicare Advantage plan or switch their plan choice during the Annual Coordinated Election Period, which runs every year from October 15 to December 7. Any election made during this period will be effective the following January 1.
In New York State if a person with Medicare enrolls in an MA plan and later returns to fee-for-service Medicare, they will be able to buy a Medigap insurance policy regardless of age or health status at any time. However, there could be a pre-existing condition waiting period if there is more than a 63-day lapse in coverage.