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Medicare Advantage Plans (Part C)

As we've mentioned, the main advantage of Medicare Advantage plans is that they limit the amount of money you have to pay out of your own pocket for health care. Under most Part C plans, there's a formal limit to how much you have to pay out-of-pocket each year for in-network medical services normally covered under Medicare Parts A and B. This limit is called the "maximum out-of-pocket amount for in-network medical services." (Under a POS plan that allows you more flexibility about the doctors or hospitals you choose, the out-of-pocket maximum is usually higher. In 2012, it is $8,000.)

Generally, monies you pay for co-payments and coinsurance for in-network covered services count toward the maximum out-of-pocket amount. However, monies you pay for plan premiums and for Part D prescription drugs do not count toward the maximum. If you reach the maximum out-of-pocket amount, you do not have to pay any out-of-pocket costs for the rest of the year for in-network covered Part A and B services. However, you must continue to pay all plan premiums.

An important note, related to out-of-pocket maximums: Once you've reached the maximum, most Part C plans prohibit providers from mixing in additional separate charges - sometimes called "balance billing" - that they send to you directly. This prohibition applies even if the plan pays a provider less than the provider charges for a service or if there's some other dispute between the plan and the provider. Another important note: To qualify for some Part C plans you must be entitled to Medicare Part A and enrolled in Part B. Usually, the Part C plan administrator will help you make sure this "paperwork" is in order - but it's important that you realize rules may require you to enroll in Part B even if you're using a Part C plan. If you choose a Part C plan, you will need to choose a network primary care provider (PCP), who oversees and coordinates your care.

In most situations, your PCP must give you approval in advance before you can use other providers in the plan's network - such as specialists (oncologists, cardiologists, etc.), hospitals, skilled nursing facilities or home health care agencies. This is called giving you a "referral." Referrals from your PCP are not required for emergency care, urgently-needed care while you're traveling or certain types of preventive and alternative services. You also don't need referrals if you've chosen certain types of POS plans. That said, under most Part C plans, your PCP will provide most of your care and will help you arrange or coordinate the rest of the covered services you get as a member of our Plan. This includes:

  • x-rays
  • laboratory tests
  • therapies
  • care from doctors who are specialists
  • hospital admissions, and
  • follow-up care

"Coordinating" your services includes checking or consulting with other plan providers about your care and how it is going. In some cases, your PCP will need to get prior authorization or approval from the plan administrator. Another example of coordination: A specialist, clinic, hospital or other provider you're using may leave the plan. If you're under active treatment with the provider at the time, the plan will notify you in writing and make arrangements to continue your care on temporary basis while your PCP helps you look for another provider.

It is important to know which providers are in your plan's network because, with a few exceptions, you must use network providers to get your medical care and services. (The exceptions are emergencies, urgently needed care when the network is not available - generally, when you are out of the area - certain types of dialysis services and cases in which the plan authorizes use of out-of-network providers.)

If you want or need more flexibility in choosing doctors, it's important to shop around. Some Part C plans - particularly PFFSPs and POS plans - operate on an "Open Access" basis, which means you do not need permission or a referral to see a specialist. This comes close to the flexibility offered by traditional Medicare and is a big deal for some people.