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Four Different Types of Medicare Advantage Plans
The four most common types of Medicare Advantage Plans
When you choose to receive your Medicare benefits from a Medicare Advantage Plan (Medicare Part C), you have some important decisions to make.
Depending on where you live, you may have several private companies and various types of plans to choose from. Also, most plans offer the choice to include Prescription Drug coverage (Medicare Part D) along with a Medicare Advantage Plan.
Many private companies offer one or more of the following types of Medicare Advantage Plans:
Medicare Advantage HMOs
The HMO (Health Maintenance Organization) plans are a lot like the HMO plans that might have been offered through your previous employer.
- Typically, you must use the doctors, hospitals and other service providers that are in the HMO's network.
- Most HMOs require members to pick a primary care physician. This is the doctor you will see for all normal care visits. This doctor will help you manage your care and will refer you to a specialist when needed.
Medicare Advantage PPOs
The Medicare Advantage PPO (Preferred Provider Organization) plans also closely resemble the PPO plan that you might have been offered through your employer's health care plan.
- You may choose to see almost any doctor you wish. If you use the doctors, hospitals and other service providers on the plan's list of "preferred providers," your copayments and other costs will be lower.
- In most cases, you can choose to receive care from a doctor who is not on the plan's list, but, you will pay more for office visits and other services. Sometimes the amount that you pay can be quite high compared to the "preferred provider" amount.
- There are local and regional PPOs. Local PPOs offer county specific service areas and tend to be located in and around larger cities. Regional PPOs offer coverage in rural areas and include statewide service areas.
Medicare Advantage Private Fee-for-Service1
Generally, a Private Fee-for-Service plan will pay a percentage of the cost for health care services, and you are responsible to pay the remainder. For example, the plan might pay 80% of your doctor and hospital costs, while you pay 20%.
- Historically, people enrolled in Private Fee-for-Service plans have been able to choose any health care provider. Under the plan terms and conditions, there was a set percentage of how much the plan would pay and how much the patient would pay.
- Beginning in 2011, most Medicare Private Fee-for-Service plans were required to start working with networks of doctors, hospitals and other health care providers. As a result, many private Fee-for-Service plans now seem more like PPO plans where you pay less money within the network of health care providers.
Medicare Special Needs Plan
Special Needs Plans are usually HMOs or PPOs.2
Membership is limited to people with certain diseases and circumstances.
- Special Needs Plans may be available to eligible individuals with very serious and disabling health conditions caused by chronic diseases. Some examples include end-stage liver disease, end-stage kidney disease, heart failure, stroke, severe diabetes and dementia.
- Institutional Special Needs Plans may be available to eligible individuals who live in a nursing home or need a home nurse.
- Dual Eligible Special Needs Plans may be available to those who are eligible for both Medicare and Medicaid.
- All Medicare Special Needs Plans must also include Prescription Drug coverage (Medicare Part D).
There are a few other types of Medicare Advantage Plans not listed in this article. You can learn more about all types of Medicare Advantage Plans at medicare.gov.