Types of Medicare Managed Care Plans
Medicare Cost Insurance
Medicare cost policies are offered by certain HMOs that have entered into a special arrangement with the federal Centers for Medicare & Medicaid (CMS). The HMO agrees to provide Medicare benefits. The HMO may provide additional benefits at additional cost.
Medicare cost insurance will only pay full supplemental benefits if covered services are obtained through HMO plan providers. You must live in the plan service area to apply for Medicare cost insurance. The HMO plan providers are selected by the HMO.
In a Medicare cost insurance policy you are not "locked in" to the HMO plan providers for your Medicare benefits. Medicare will still pay its share of approved charges if the services you receive outside the network are services covered by Medicare. If you go to a health care provider who does not belong to your HMO without a referral from your HMO physician, you will pay for all Medicare deductibles and copayments. The HMO does not pay any benefits when you obtain services from a non-plan provider without first obtaining a referral.
To review the Medicare cost insurance plans approved in Wisconsin, see the publication Medicare Supplement Insurance Approved Policies.
Medicare Advantage Insurance
Medicare Advantage plans are offered by certain HMOs or insurance companies that have entered into special arrangements with the federal Centers for Medicare & Medicaid Services (CMS). Under these arrangements the federal government pays the HMO or insurance company a set amount for each Medicare enrollee. The HMO or insurance company agrees to provide all Medicare benefits. The HMO or insurance company may provide some additional benefits, which may be at an additional cost.
Your Medicare Advantage plan can terminate at the end of the contract year if either the plan or CMS decides to terminate their agreement.
Medicare Advantage plans are not regulated by the state of Wisconsin Office of the Commissioner of Insurance. Therefore, these plans are NOT required to cover Wisconsin mandated benefits, nor are the plans guaranteed renewable for life like Medicare supplement policies.
You can obtain more information by requesting a copy of OCI's brochure Medicare Advantage Plans in Wisconsin. You may also call CMS customer service at 1-800-MEDICARE (1-800-633-4227) or 1-877-486-2048 TTY.
Medicare Health Maintenance Organization
If you enroll in a Medicare Advantage plan through a health maintenance organization (HMO) that has contracted with CMS, you are "locked in." This means that, except for emergency or urgent care situations away from home, you must receive all services, including Medicare services, from HMO contracted providers. If you go to a health care provider who does not have a contract with your HMO without a referral from your physician, you will be responsible for the entire cost of the services you receive, including Medicare costs. To be eligible for a Medicare Advantage plan through an HMO, you must live in the HMO's service area.
Medicare Preferred Provider Organization Plans
You may also enroll in a Medicare Advantage plan through an insurance company with a preferred provider organization plan (PPO) that has entered into a contract with CMS. Medicare Advantage PPO plans are similar to HMO plans in that if you enroll in a PPO plan, you are "locked in." In order to receive full coverage under the PPO option, you must receive all services, except for emergency or urgent care situations away from home, from plan providers. However, you may receive services from providers outside the plan at an additional cost.
Medicare Point-of-Service Plans (POS)
A type of managed care health plan with a network of providers that also permits you to use non-network providers, usually at some additional cost to you. The POS plan may also have requirements that you obtain a referral from your primary provider before the plan will agree to pay for out-of-network care. Similar to the HMO, the POS has small copayments for medical services received from providers in the network.
Remember: If you buy a policy from an HMO, you do not have to file claims. Except for out-of-area claims, the HMO takes care of all your paperwork. You also are not responsible for the charges in excess of Medicare's approved charge.
Medicare Private Fee-For-Service Plans
Medicare Advantage private fee-for-service (PFFS) plans differ from HMO and PPO plans because they allow you to go to any doctor, hospital, or health care provider that agrees to accept the PFFS plan's terms of payment. PFFS plans do not have contracts with doctors, hospitals, or health care providers. You do not have to obtain a referral from the plan to go to a doctor, hospital, or specialist of your choice. However, it is your responsibility to verify that the provider is willing to accept the PFFS plan's payment terms. Providers can stop seeing you at any time they decide they do not want to accept the terms and reimbursement rates of your Medicare private fee-for-service plan.
To review the Medicare Advantage insurance plans approved in Wisconsin, see the publication Medicare Advantage Plans in Wisconsin.
You will not need a Medigap policy if you join an HMO with a Medicare contract since you will not be able to collect on the Medigap policy benefits. If you already have a Medigap policy to supplement your fee-for-service Medicare coverage and you decide to join an HMO, you may want to keep your Medigap policy for a month while you see if you like the HMO. If you decide to stay in the HMO you would be advised to discontinue your Medigap policy as you do not need it and will not be able to collect on its benefits.