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What is Medicare Part C?

Medicare Advantage Plans

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Medicare Advantages Plans or Medicare Part C offers Medicare Beneficiaries an alternative to traditional Medicare. These plans allow patients to choose a plan that can provide the flexibility they need in order to suit their specific needs since most Medicare Beneficiaries are on a fixed income.

Covered Services

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Medicare Advantage Plans companies must follow the same set of rules that govern the Medicare program. Medicare contracts with public or private organizations to provide a variety of health coverage options that cover the same benefits that Medicare Part A and Part B cover.

Medicare Part A is called the hospital insurance because it helps pay for the care a patient receives in a hospital inpatient setting, critical access hospital, skilled nursing facility (SNF), hospice and home health care.

Medicare Part B is the part of Medicare called medical insurance. This part of Medicare is optional to patients one they reach the age of 65 and charges a monthly premium. Part B covers most services not covered by Part A.

Plan Types

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There are four different types of Medicare Advantage Plans that beneficiaries can choose from.
  1. Health Maintenance Organization or HMO Plans

    Medicare HMO plans operate in a similar way as managed care HMO plans. The characteristic that stands out the most with HMO plans is its capitation payment method. Per patient payments, or capitation payments, are fixed, monthly payments received by the medical office for the patient. This amount stays the same regardless of how many visits the patient has or the cost of incurred expenses and even when they don't receive care at all. Other characteristics of an HMO are:

    • Limited to in-network providers except in emergencies
    • Referrals are required to see a specialist
    • Prior authorization is required for certain services
    • Members have no deductible and minimal copays
  2. Preferred Provider Organization or PPO Plans

    Medicare PPO plans are similar to managed care PPO Plans. PPO's pay by the fee-for-service method. An office visit, lab tests, xray, or other service are individually paid according to the fee schedule. This payment method allows the medical office to receive the maximum reimbursement for each episode of care. Some characteristics are:

    • In- and out-of-network providers allowed, patients pay less when in-network providers used
    • No referrals are required to see a specialist
    • Prior authorization is required for certain services
    • Members may be responsible for deductibles, copays and coinsurance
    • Offers extra benefits compared to traditional Medicare, at an extra cost
    • Includes an annual out-of-pocket maximum
  3. Private Fee-For-Service or PFFS Plans

    The most important thing to know about Medicare PFFS plans is that it allows providers to "balance bill" up to 15% over the plan payment amount for service. PFFS plans operate similarly to indemnity plans.

    Indemnity insurance plans makes payments to the medical office based on the fee-for-service model. In a fee-for-service, the medical office is paid a set amount for each type or unit of service rendered. An office visit, lab tests, xray, or other service are individually paid according to the fee schedule. This payment method allows the medical office to receive the maximum reimbursement for each episode of care.

  4. Special Needs Plans or SNP

    Medicare Special Needs Plans are geared towards beneficiaries that live with certain chronic conditions, diseases or illnesses. Benefits are limited to patients that:

    • Have a specific chronic or disabling condition such as HIV/Aids, diabetes, mental health, congestive heart failure (CHF), just to name a few
    • Live in a nursing home or receive care at home
    • Receive both Medicare and Medicaid benefits

Carriers

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Medicare Advantage plans are sometimes confused with managed care plans by medical office staff. Many of these plans are offered through major health insurance companies such as:

  • Aetna
  • AARP
  • United Health Care
  • Blue Cross Blue Shield
  • WellCare

It is important to be aware of the Medicare Advantage plans in your area and how to file claims in order to prevent delayed payments.

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