Breaking Down Medicare Advantage PPO Plans

• PPOs are often selected because they offer more provider freedom and the ability to obtain special services without a referral.

• PPO costs can be potentially higher compared to other medicare advantage plans, depending on the circumstance.

• The most popular Medicare Advantage Plans are PPOs and HMOs, and it’s important to know about both before selecting one.

Medicare Advantage is a different way to receive your Medicare Part A and Part B coverage. These options are offered by Medicare-approved private companies that must follow the rules set by Medicare. You still will have Medicare, however, your coverage will come from a different company rather than standard Medicare.

Medicare Advantage vs. Original Medicare

While both options cover your Medicare Part A and Medicare Part B, Medicare Advantage offers additional services that Original Medicare doesn’t cover. Options such as health and fitness program, transportation to and from medical appointments, as well as some dental, vision, and hearing services. Certain Medicare Advantage plans can also be tailored to specific illnesses and needs.

PPO plans are one type of Medicare Advantage Plan—also known as Medicare Part C or MA plans—offered through a private insurance company. PPO plans allow for a patient to select either from an in-network line of healthcare providers and doctors or have the option to use any provider that accepts Medicare. This allows for much more flexibility on who can see, treat, and provide care.

PPO plans have a network of doctors, healthcare providers, and hospitals to choose from. However, beneficiaries also have the freedom to choose their own providers as long as they accept Medicare. PPOs do not require a Primary Care Physician (PCP) or a referral to see specialists. Choosing in-network options has the potential for much lower costs, and patients can expect to pay out-of-pocket expenses that are higher if they choose to use outside providers.

By law, Medicare Advantage Plans are required to give the same coverage as Medicare, with the potential for additional benefits. In addition to Part A, Part B, and Part D (in most cases), some PPO plans cover dental, vision, hearing visits, and even transportation rides to and from appointments. Other benefits may apply depending on the plan.

A PPO plan usually offers prescription drug coverage—otherwise known as Medicare Part D— though it’s important to ask. Beneficiaries should ensure that their PPO plans have prescription drugs covered—if not, they can’t qualify for Medicare Part D.

The patient is usually expected to pay for premiums, deductibles, and copayments in a PPO plan.

Premiums

Even with a PPO, there is still a requirement to pay for the Part B portion of the plan. PPOs typically have higher monthly premiums than other medicare advantage plans.

Deductibles

Deductibles can potentially be charged for both the plan and the prescription drug coverage, but not in all cases. Some plans may require fulfilling a deductible before covering medical services.

Co-Payments

Co-payments can vary depending on whether you choose doctors and health care providers in the established network or outside of the network. Costs typically are lower by staying within the network, but there is still the freedom to choose outside providers. However, the out-of-pocket costs may be higher, and the patient will likely have to pay their co-pays in full at the time of the appointment, then submit to their PPO plan to reimburse them later.

Out-of-Pocket Maximum

All plans have an out-of-pocket maximum for both in and out-of-network providers that you will pay before they will 100% cover your services. Services such as copays and deductibles count towards an out-of-pocket maximum, while premiums or any out-of-network service do not.

As with any medicare advantage plan, there are pros and cons to take into consideration.

Advantages

• Provides flexibility to choose doctors, health care providers, and hospitals, even if they are out of network without referrals.

• There is no required primary care provider..

• Includes potential additional benefits such as transportation to and from appointments and coverage for dental, vision, and hearing visits (compared to standard medicare covered services).

• No need for a referral to visit an in-network specialist.

• You are covered when you travel in the case of an emergency.

Disadvantages

• If you use out-of-network providers, costs can add up quickly.

• Multiple out-of-pocket maximum amounts.

• Not as widely accepted as HMOs, which leaves fewer options to choose from.

• Leaves the patient responsible for coordinating and maintaining their own care, rather than a provider..

Out of the many Medicare Advantage Plans, preferred provider organization (PPO) and health maintenance organization (HMO) are the two most commonly selected. So what are the main differences between the two?

A Medicare PPO plan allows flexibility and using the provider the patient prefers. HMO requires you to use their network of providers. However, you pay more for out-of-network options in either case: with PPOs, you pay a higher rate than you would with a provider in-network, while with HMO you pay full cost for an out-of-network provider due to having no coverage outside the established network.

A PPO plan has the potential to save money by staying within the network of providers already listed within the plan. With an HMO plan, the costs start lower as they do not provide an option for out-of-network providers in their coverage.

Depending on whether a person requires more flexibility in their provider choices or needs a more cost-efficient option will likely be the main factor in deciding which medicare advantage plan is right for them.

Note: For more information on the differences between PPO and HMO plans, check out this source.

Private Fee-for-Service (PFFS) Plans 

This type of plan decides beforehand how much you will have to pay for a healthcare provider, doctor, or hospital visit, and how much it will be willing to pay. To learn more about PFFS plans, visit this source.

Special Needs Plans (SNP)

This type of plan is only available to people with specific diseases, and the plan tailors specifically to that particular group of people. To learn more about SNP options, visit this source.

Health Maintenance Organization Point of Service (HMO POS) Plans

This type of plan functions similarly to an HMO, but it includes additional Point of Service benefits, which can provide more flexibility than a standard HMO. To learn more about HMO POS plans, visit this source.

There are a variety of enrollment periods for Medicare beneficiaries to take advantage of such as the initial enrollment period (three months after a person’s 65^th birthday), the general enrollment period (January 1^st-Match 31^st), and more.

Note: To learn more about Medicare’s enrollment periods, visit this source.

Initial Enrollment Period (IEP)

Enrollment for Original Medicare begins three months before your 65^th birthday, and the window lasts for seven months.

General Enrollment Period (GEP)

If you didn’t sign up during your initial enrollment period, you can sign up during the general enrollment period, which goes from January 1^st through March 31^st. General enrollment for most Medicare Advantage Plans falls between April and June (check with your specific plan for dates).

Note: To join in a Medicare Advantage Plan, you must already be enrolled in Part A and Part B.

Fall Enrollment Period (FEP)

If you want to switch from Original Medicare to a Medicare Advantage Plan, or to a new Medicare Advantage Plan from the one you currently have, then you can do so during the Fall Enrollment period, which goes from October 15-December 7^th of each year.

Special Enrollment Period (SEP)

This period only applies to Part B of your Medicare plan. This allows you to enroll in Part B if at the time you were eligible for Medicare, you were still covered by your job’s insurance, and wanted to delay signing up for Part B without penalty at that time. Check with your provider for SEP dates.

Note: Certain health and drug plans can choose to end their Medicare contract for the upcoming year, ending your coverage under that plan. Be sure to stay aware of these possibilities so you can opt to enroll in a new plan.