What’s the Difference Between Medicare Advantage HMO and PPO Plans?

Medicare Advantage (Medicare Part C) plans offer you a different way to get your Original Medicare Parts A and B benefits. They’re offered by private companies approved by Medicare, and can be set up in different ways.

Let’s look at two types of Medicare Advantage plans: Health Maintenance Organization (HMO) plans and Preferred Provider Organization (PPO) plans.

HMOs and PPOs: How They’re Alike

Both HMO and PPO Medicare Advantage plans offer one-stop shopping for all of your health care. As does any Medicare Advantage plan, they combine hospital care with doctors’ visits in a single plan. Many plans offer prescription drug coverage, too. They may also have dental, vision and hearing care, fitness and wellness programs, and other health care benefits not included in Original Medicare.

Both HMOs and PPOs are coordinated care Medicare Advantage plans. The care is called “coordinated” because the plans are created around a network of doctors and hospitals working together to provide your care. When a plan sets up a “network,” it signs agreements with health care providers to see plan members for less than their usual cost.  Each coordinated care plan sets up its own network. You may have to choose specific doctors and hospitals. This is different from Original Medicare, which allows you to visit any doctor or hospital that accepts payment from Medicare.

HMOs and PPOs: How They’re Different

HMOs: With an HMO Medicare Advantage plan, you may need to see only doctors in the network in order for your plan to pay for it. If you go outside the networkThe group of health care providers, such as hospitals, doctors and pharmacies, that agrees to provide care to the members of a Medicare Advantage coordinated care plan or Medicare Part D prescription drug plan. These providers are called “network providers” and “network pharmacies.” for care, you may have to pay the full cost for that health care. So if you have a doctor that you want to keep seeing, it’s important to make sure that doctor is “in-network” for any HMO you’re considering.  Note: This network rule doesn’t apply to emergency care, urgent care or out-of-area renal dialysis.

HMO members also often have to choose a primary care physician (PCP) in the network to coordinate their care. Your PCP provides you general medical care. You may also need a referral from your PCP to see an in-network specialist.

PPOs: Unlike an HMO, with a PPO Medicare Advantage plan, you may not need to choose a PCP. And you probably don’t need to go through a PCP in order to see a specialist.

With most PPOs, you can see doctors outside the network The group of health care providers, such as hospitals, doctors and pharmacies, that agrees to provide care to the members of a Medicare Advantage coordinated care plan or Medicare Part D prescription drug plan. These providers are called “network providers” and “network pharmacies.”without having to pay the entire cost yourself. However, you’ll usually pay a larger share of the cost of your care at a non-network health care provider. For example, the plan may pay 90% of the cost for care received in-network, but only 60% of the cost for the same care provided out-of-network. With some PPOs you may need to pay the non-network doctor directly, and then file a claim for partial reimbursement (payback).

 

–This information was provided by Medicare Made Clear

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