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Medicare beneficiaries may elect to
join an HMO as an alternative to traditional fee-for-service
Medicare. Medicare HMOs contract
with the Centers for Medicare & Medicaid to provide the full range
of Medicare-covered services to Medicare beneficiaries for a fixed
monthly fee from the government. Generally you have coverage for care
only from providers who are part of the HMO network. The only
exceptions are for emergency services, which you may receive anywhere
in the United States, and urgently needed services, which you may
receive while temporarily away from your HMO's service area. Therefore,
if you spend part of the year (more than 90 days) outside the HMO's
service plan area, joining an HMO may not be in your best interest.
When you
first enroll in an HMO, you will be asked to select a primary care
physician from the HMO's list of doctors. A primary care doctor is
responsible for managing all of your medical care, including referrals
to a specialist like a cardiologist or gastroenterologist, when your
doctor thinks you need it. Some
HMOs offer a Point of Service (POS) option for an additional cost.
Under the POS option, you will be allowed to see providers outside the
network, and the HMO usually pays 70 or 80% of the cost.
Some HMOs
also offer coverage for services that Original Medicare doesn’t provide,
including routine physical exams, dental benefits, eyeglasses and
hearing aids.
Health
Maintenance Organizations (HMOs) are the most common type of Medicare
Advantage plans. Other types of managed care plans are Preferred
Provider Organization (PPO) and Private Fee-for-Service Plans (PFFS).
The Preferred
Provider Organization (PPO) has the flexibility to determine how the
benefits will be offered, but they must provide all of the benefits
available under Medicare Parts A and B.
Therefore applicants need to review plan materials carefully.
You only use
doctors, specialists and hospitals on the PPO plan’s list
(network). You do not need
referrals to specialists. You
can go to doctors, specialists, or hospitals not on the list, but
access to providers outside the network are at higher cost-sharing
amounts than network providers.
Unlike HMOs,
the PPOs have no capacity limits. Consequently, they will be able to
enroll all beneficiaries who wish to enroll.
Private Fee-for-Service Plan permit
members to obtain services from any Medicare approved participating
provider who accepts its payment rates.
Providers who accept a PFFS rate for one service may refuse it
for another. Beneficiaries are
generally responsible for a percentage of the accepted rates. PFFS rates may be higher than
Medicare rates.
Centers for Medicare and Medicaid
(CMS) Publication #10144-Your Guide to Private Fee-for-Service Plans
state the following important information:
“Private Fee-for-Service Plans may let providers (such a
doctors or hospitals) charge you 15% over the plan’s payment
amounts for services. This 15% balance billing amount applies
to providers who have a written contract with the Private
Fee-for-Service Plan or who the company has decided to think of as
having a contract (deemed) because they have met certain
conditions. Ask if your Private
Fee-for-Service Plan allows providers to balance bill.”
Therefore, I suggest the following:
Before shopping and /or making a
decision on a PFFS policy, the client becomes PFFS-literate. Therefore, I recommend the above CMS
publication #10144, “Your Guide to Fee-for-Service Plans”
(call 1-800-Medicare for the publication). And the info will enable you to ask
questions about the available plans.
PFFS is new to New York City, so I
have no “hands on” experience.
Please refer
to HMO segment 05 for a “closer look” at
benefits and cost sharing at HMOs and PPOs in Manhattan (New York
County). My analysis may be helpful
in choosing a plan.
Updated:
January 29, 2007
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