The Different Types Of Medicare Plans
The different types of Medicare plans
The contributions you made toward your Social Security and Medicare taxes in your working years can reap several benefits when you become a senior. Once you turn 65, you automatically qualify for Medicare Part A and Part B.
The Medicare plans
From the Original plans, Medicare Advantage plans, and Part D insurance to Medigap plans, you have to sort through many choices.
What is Original Medicare?
- Original Medicare is the federal government’s initial Medicare program.
- It provides hospital insurance under Part A and medical insurance under Part B.
What is Part C?
- Part C is an alternative way to receive your Part A and Part B benefits.
What are the different types of Medicare Advantage plans?
The types of Advantage Medicare plans are:
- Health Maintenance Organization
- HMO Point-Of-Service
- Preferred Provider Organization
- Private Fee-For-Service
- Special Needs Plans
- Medical Savings Account
What is the difference between the Medicare Advantage plan categories?
You can pick Advantage Medicare plans according to your medical care needs:
- HMO: Health Maintenance Organization : These operate in local regions and have a network of hospitals and doctors.
You can only visit doctors or hospitals within this network. You should select a primary care provider. In case you want to see a specialist, a referral is needed. Mostly, they cost less than other Medicare Advantage plans. HMO POS: HMO Point-Of-Service : Under this special type of HMO Plan, you can visit a care provider who is not in the network, but you will have to pay more for these visits. PPO: Preferred Provider Organization : They have a network of service providers. You can go outside the network, but you need to pay more for these. You do not need to specify a primary care provider, and to see a specialist, you do not require a referral. They are less restrictive than HMO Plans, but you usually pay a higher premium for PPO. PFFS: Private Fee-For-Service : PFFS plan set up their own payment structures. They decide what they will pay your care provider and what you will pay them. You can generally see doctors outside the network, but most of them may not agree to the PFFS payment terms. You have to pay less for medical care received from within the plan’s network. You don’t have to select a primary care provider, and a specialist can be approached without the need for a referral. For each medical service you receive, you will have to pay the plan’s copay or coinsurance amount upfront. SNP: Special Needs Plans : These are meant for people who have a chronic and severe medical condition like ESRD, chronic heart failure, diabetes mellitus, etc. It is also meant for those who live in special caregiving facilities like a nursing home. There are restrictions like in HMO Plans, and the plan network includes specialists in the condition that qualifies you for SNP. You can enroll at any time rather than during a specific period. It includes prescription drugs coverage. MSA: Medical Savings Account : MSA plans will deposit a portion of your Medicare funds into a special account, which you can use to pay for services. Any provider who accepts Medicare can be approached. When your Medicare account funds run out, you pay the full cost until you meet the deductible, and then the insurance takes over. MSA plans do not cover prescription drugs, and they have a high deductible. You can roll over unused funds in the savings account to the next year. If you leave the plan, you can withdraw any remaining amount in the deposit, but you have to pay tax on it.
What is Part D insurance?
- Original Medicare does not cover the cost of your regular medications. For those, you need to pick a Part D insurance that provides prescription drug coverage or pick a Medicare Advantage Plan that includes Part D coverage.
- Prescription drugs coverage helps you get your medicines at much lower prices than retail.
What are the basic 2018 Medicare premiums?
- In Original Medicare, you pay a premium for Part B, which is $134. For higher income groups, there will be an extra premium added to this.
- You will also have to pay a premium for Part D insurance. The average premium for prescription drugs coverage is currently around $34 per month.
- If you choose to get a Medigap plan or Advantage Medicare plans, you will have to pay the plan premium, which varies according to the plan and the provider.
What is Medicare Supplemental Insurance?
- Medicare Supplemental plans are called Medigap plans.
- They cover the out-of-pocket costs, like the 20% you pay for outpatient care under Part B.
- Many plans also cover deductibles, copay, coinsurance, etc.
- Remember that if you choose a Medicare Advantage plan, you cannot have a Medigap plan
Spend some time studying the features and benefits of the plan before choosing one that fits all your needs, including prescription drugs coverage, and one that also reduces your out-of-pocket spends.
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