Medicare Part C | What To Know

Medicare Part C | what to know is another choice for the undecided Medicare recipient. The Centers for Medicare and Medicaid Services (CMS) uses the term “Part C” to describe HMO (health maintenance organization), PPO (preferred provider organization), PFFS (private fee-for-service), SNP (Special Needs Plan, CSNP (Chronic Special Needs Plan and MSA (medical savings account) plans offered by private insurance companies. You will often hear medical office staff and insurance representatives refer to Part C simply as “Medicare Advantage” or “MA Plan.” If you enroll in Part C, all your hospital and medical office visits will be covered by a private plan. Additionally, Medicare Advantage plans are required by law to offer at least the same coverage as Original Medicare.

If I Enroll In Part C/Medicare Advantage Plan, Will I Still Be A Recipient Of Medicare?

Yes, you will still be a part of the Medicare program. In order to enroll in Part C, you must first accept Part A and choose to enroll in Part B. Additionally, should you choose a Medicare Advantage Plan and later decide that you don’t like it, then you can drop the plan during the disenrollment period. This disenrollment period occurs from January 1 to March 31 every year. By disenrolling, you enroll back to Original Medicare where all your insurance needs will be covered by Parts A and B. We’ll discuss enrolling and disenrolling in more detail later in this post.

To help you decide if Part C is the right choice, we’ve created a list of facts that describe how Medicare Advantage plans differ from Original Medicare:

Administered by private insurance companies

Unlike Original Medicare, Part C is NOT administered by CMS. Instead, Part C is administered by private insurance companies that are approved by Medicare. These private insurance companies – corporations like UnitedHealthcare, Cigna, Aetna – contract with Medicare to offer recipients a different choice for their Medicare coverage. This means the private insurance company you picked for your Part C plan will process all of your health claims. Consequently, Original Medicare will not pay for your services.

Network Providers

With Original Medicare, you have your choice of which doctor, hospital or provider you wish to visit. This is not always true of Medicare Advantage plans. Medicare Advantage plans can come with a list of preferred providers for you to use. If you go out of network, there is typically a much higher out of pocket cost. In addition, there is likely no out-of-network coverage if you have an HMO plan.

Deductibles, Copayments and Coinsurance

There can be higher deductibles in addition to copayments and coinsurance for covered services.

Maximum out of pocket costs

The highest maximum out of pocket cost for Medicare Advantage plans in 2019 is $6,700. This amount has been set by the Centers for Medicare and Medicaid Services (CMS). Plans are allowed to have lower maximum out of pocket costs. However, the highest amount they are allowed to have by law is $6,700. What a beneficiary pays towards prescription costs or towards extra benefits like dental, vision and hearing coverage do not count towards the maximum out of pocket costs.

Additional Premiums

You may have to pay a monthly premium on top of your usual Part B premium if the Part C plan you chose has a monthly premium. Remember, Medicare Advantage plans are private insurance companies. This means that you may receive an additional bill for your Part C coverage.  It is possible that a Medicare Advantage plan will provide you with extra benefits Original Medicare doesn’t cover like dental, vision, and prescription drug coverage. However, it’s important to ask about this possibility before you sign with a private health plan. Not all Medicare Advantage plans offer extra benefits.

Who Is Eligible To Join A Medicare Advantage Plan?

Anyone who is eligible for Original Medicare can join a Medicare Advantage plan so long as they do not have End Stage Renal Disease (ESRD). However, the plans you are eligible to join is largely determined by the area in which you live. This means that even if you would like to enroll in PPO plan, there may not be one available in your area. For this reason, it’s very important to shop around for plans. Click here to check available plan in your region https://www.medicare.gov/find-a-plan/questions/home.aspx

What is the Annual Enrollment Period (AEP)?

The Annual Enrollment Period runs from October 15 through December 7th.  Any decision made during this time frame becomes effective January 1st the following year.  This is the time you can change from one Medicare Advantage Plan to another. You can drop a Medicare Advantage and return to Original Medicare.  You can also change from Original Medicare to Medicare Advantage during the Annual Enrollment Period. This is also the time frame to enroll in a Part D Prescription Plan, change a Part D Plan or disenroll entirely.  

There is a common misconception among Medicare Beneficiaries this is the time to change your Medicare Supplement Plan without any underwriting questions.  There is no time during the year you are eligible to change your Medicare Supplement plan without underwriting accept in a few states. Those times usually revolve around your birthday in California and Oregon.  Your anniversary of enrollment in the Medicare Supplement in Missouri and Washington state is the only state that allows you to change anytime during the year without underwriting.  

A Word About Five-Star Plans

When comparing plans, make sure to check the plan’s rating. Through surveys and outreach, Medicare tracks customer service scores for all approved plans and rates them according to a five-star system. The plans rated highest usually offer additional benefits. You can switch to a five-star plan during one of your open enrollment periods, or there is a one time per calendar year Special Election Period to switch to a FIve-Star plan if there is one available in your area.

What Type of Medicare Advantage Plans Are Available?

Part C plans come in different versions.  There is HMO’s (Health Maintenance Organizations), PPO’s (Prefered Provider Organizations), PFFS (Private Fee for Service), MSA, (Medical Savings Account), SNP (Special Needs Plans) usually for those with Medicare and Medicaid, and CSNP (Chronic Special Needs Plans), for those with specific chronic conditions. 

There Are Two Main Medicare Advantage Types:

HMO Plan:

  • HMO’s are the most popular, probably the reason is they have the lowest premiums.  Many times they are $0 monthly premium and include Part D drug coverage. They usually require you to see doctors in their provider network. If you see an out-of-network provider it is very likely that you will need to pay 100% of the cost on your own.
  • Typically requires that you choose a primary care physician (PCP) who coordinates all your care.
  • If you wish to see a specialist, your PCP will need to refer you first.

PPO Plan:

  • Usually provides you with a network of preferred providers that you can choose from.
  • You can go out-of-network, but your costs will likely be higher.
  • No requirement to choose a primary care physician for coordination of care.
  • No referral required for visits to specialists.

When Can I Enroll?

The Part C enrollment requirements are the same as Original Medicare. You can enroll when you are first eligible for Medicare because you are turning 65or when you are diagnosed with a disability under age 65. However, before you can elect Part C, you must first accept Part A and enroll in Part B.  It’s important to note that Medicare Advantage plans do not insure individuals with ESRD (end stage renal disease). If you have been diagnosed with ESRD, then you qualify to enroll in Original Medicare only. For more information on the ESRD program, visit https://www.medicare.gov/information-for-my-situation/signing-up-for-medicare-if-you-have-esrd

When Can I Leave a Part C Medicare Advantage Plan?

There are several windows when the rules allow a Medicare Beneficiary to do this.  The first we will talk about is when you enroll in a Medicare Advantage plan when you turn 65.  This applies only when you turn 65 and at no other time. During the first 12 months of your enrollment, you can disenroll back to Original Medicare Part A and B.  In addition, if you want to add a Medicare Supplement plan you can. The important part of this is you can add the Medicare Supplement at the same time you disenroll and the Medicare Supplement company you choose must offer you a Medicare Supplement guaranteed issue.  This means the Medicare Supplement company cannot ask you any underwriting questions for condition of acceptance and must also cover any pre-existing conditions you may have.

What If I’m Unhappy With My Plan? Can I Return to Original Medicare?

Yes. Your Medicare Advantage decision does not have to be permanent. There are two enrollment periods during each year should you want to drop your plan and receive coverage through Original Medicare. The first occurs January 1 through March 31 and the second occurs October 15 through December 7.

When Can I Switch From Original Medicare To a Part C Medicare Advantage Plan?

The rules are different for this change. You can only switch to Original Medicare once annually, October 15 through December 7.  In addition to the open enrollment periods that Medicare makes available for recipients, you can also change your enrollment if certain “special” circumstances apply. For instance, if you change residences or lose other insurance coverage, then you may qualify to make updates to your coverage. Medicare refers to these special exceptions as Special Enrollment Periods (SEPs). There are several special circumstances that provide an opportunity to change or update coverage, but when you can make the change depends on each circumstance in question. To find out if you qualify, visit https://www.medicare.gov/sign-up-change-plans/when-can-i-join-a-health-or-drug-plan/special-circumstances-special-enrollment-periods

Choosing the appropriate Medicare coverage is one of the most important health and financial decisions you can make for yourself. Enrolling in Original Medicare is the first step. Deciding whether to enroll in Part C is the second. While selecting the appropriate Medicare Advantage plan may take some time, you might find that choosing Part C for your health insurance coverage is the right decision. We hope the tools we’ve shared in this post will help you navigate your decision carefully and successfully.

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