Medicare is a federal health insurance program designed for seniors aged 65 and older as well as people with qualifying disabilities.
If you have Medicare Parts A and B (often called “traditional” Medicare), you are eligible to join a Medicare Advantage plan, known as Medicare Part C. Medicare Part C is an alternative to traditional Medicare.
With Medicare Part C, you can choose from numerous private health insurance plans.
Types of Private Health Plans
Under Medicare Advantage, beneficiaries may choose from a number of private health plans, which include the following:
- Health maintenance organization (HMO) plans — HMOs require you to go to doctors, other health care providers, or hospitals that are on the plan’s list, except in an emergency. You may also need to get a referral from your primary care doctor to see a specialist.
- Preferred provider organizations (PPOs) — PPOs allow the use of doctors and hospitals outside the plan network for an extra out-of-pocket cost.
- Private fee-for-service plans (PFFSs) — These are Medicare-approved private health insurance plans for which Medicare pays part of the cost. The plan determines how much it will pay doctors, other health care providers, and hospitals, and how much you must pay when you get care.
- Special needs plans (SNPs) — SNPs limit membership to people with specific diseases or characteristics. The plan tailors benefits, provider choices, and drug formularies (the list of drugs it covers) to best meet the specific needs of the groups they serve.
- Medical savings account (MSA) plans — With this type of plan, you can join a high-deductible plan and also set up a special medical savings account with a bank that the plan selects. Medicare then gives the plan an amount of money each year for your health care, and the plan deposits some money into your account. You can use the money in your account to pay your health care costs, including health care costs not covered by Medicare. Money left in your account at the end of the year stays in the account and may be used for health care costs in future years.
Once you choose a Medicare Advantage plan, you can only change plans during certain times of the year. You can switch plans during the Medicare open enrollment period, which runs from October 15 through December 7 every year. You can also join a Medicare drug plan during that period.
There is also a disenrollment period, during which you can switch from Medicare Advantage to original Medicare. That period runs from January 1 through March 31.
Beneficiaries who are happy with the way they are receiving Medicare can stay with their program, unless the program stops participating in Medicare. New Medicare enrollees who do not choose a particular program will automatically be enrolled in traditional Medicare.
Medicare is a complex topic. For professional guidance, you may consider visiting Medicare’s Plan Finder, an online tool that helps you to compare plans. Also available are State Health Insurance Assistance Programs (SHIPs), which offer you trained counselors who can give you impartial advice. Find your local SHIP online. Or, you also may wish to seek out a qualified elder law attorney in your area.