Medicare Advantage Insurance
Health Insurance for Individuals over age 65
Medicare Advantage expands the healthcare options for Medicare beneficiaries. These options were created by the Balanced Budget Act of 1997 in order to better control the rapid growth in Medicare spending, as well as to provide Medicare beneficiaries more choices.
Previously, you could receive Medicare benefits through original Medicare or via a Medicare Managed Health Maintenance Organization (HMO). With Medicare Advantage Insurance (also called Medicare Part C), you can choose from five new ways in which to receive your Medicare benefits.
New Medicare Advantage Options
- Preferred Provider Organization (PPO): This is another managed care plan. It is formed by a group of doctors, hospitals, and other providers who contract with an insurance company. You do not have to choose a primary care physician. You can go outside of the network, but you will pay higher deductibles and copayments when you do.
- Provider Sponsored Organization (PSO): This is a managed care plan with a network of providers. The providers administer the plan and take the financial risk. You choose a primary care physician and agree to use plan providers. Most services will be provided by the network.
- Private Fee for Service Plans (PFFS): This is an insurance plan, not a managed care plan. The plan, not Medicare, sets the fee schedule for providers, but providers can bill up to 15% more. You see any providers you choose, as long as the provider agrees to accept the payment schedule. Medical necessity is determined by the plan. The plan does not have to have a quality assurance program.
- Religious Fraternal Benefit Society Plans: This is one of the managed care plan types (HMO, HMO w/pos, PPO, PSO) which is formed by a religious or fraternal organization. These plans may restrict enrollment to members of their organization.
- Medical Savings Accounts (MSA): This is a health insurance policy with a high deductible ($6,000 for 1999) combined with a savings account. Medicare pays the insurance policy premium and deposits money into your MSA each month. You can use the money in your MSA to pay your medical costs (tax free). You have free choice of providers. The providers have no limit on what they charge.
One of the best resources on the internet for researching your options is The Senior Health Insurance Information Program (SHIIP). SHIIP is a free & unbiased counseling program provided by each states Department of Insurance.