If you are looking for the right coverage, PPO Medicare plans will undoubtedly come up. PPO stands for Preferred Provider Organization. You have the option to join a PPO Medicare plan instead of taking Original Medicare. These plans have their advantages, including lower co-pays so long as you stay within the network. But, there's more you need to know.
Understanding Your Options
Once you qualify for Medicare, you can either opt for Original Medicare or a Medicare Advantage plan. Oftentimes, people who choose Original Medicare will end up paying for a supplemental policy (Medigap plan). If you choose a Medicare Advantage Plan, Medigap is not an option.
However, a Medicare Advantage plan typically offers more coverage than Original Medicare alone. The major difference is that a Medicare Advantage plan will come through a private insurance company. This is different than an Original Medicare plan where the government pays for your benefits.
Medicare Advantage plans can also go by simply MA plans. They are also known as Medicare Part C. No matter what you call them, you have a few different options when it comes to your coverage. In this piece, we'll discuss PPO Medicare plans.
What Is A PPO Medicare Plan?
A Medicare PPO plan is just one of many types of Medicare Advantage plans you can choose from. These plans all come through private insurance companies.
PPO stands for Preferred Provider Organization. This name hints at how the plan works. Basically, if you have PPO coverage, you'll pay less if you use providers within your plan's network.
For instance, your plan will have a preferred doctor for you to use for annual check-ups. Using them will save you money. However, a PPO plan does not require you to choose a primary care doctor. You can go to anyone you choose.
With a PPO plan, you can still choose to use providers who aren't in your plan's network. Of course, you will pay more for doing so. You may pay more even for emergency visits to doctors and hospitals that aren't part of the network.
If you ever need to see a specialist, your PPO plan probably won't require you to get a referral to do so. Again, you will usually pay less for covered services if you go to someone within the network.
What's Included In A PPO Plan?
Most PPO Medicare plans cover prescription drugs. However, you should always ask in order to verify. If your plan does not include prescription drug coverage, you do have options.
In some cases, you can join Medicare Part D. Part D is a separate plan that provides you with prescription drug coverage. However, you can not sign up for Part D if you are in a medical benefits PPO plan. If you want drug coverage, seek a MA plan that includes it.
A MA plan will offer coverage for all Medicare services. Additionally, some cover even more services. For example, you can find MA plans that also cover your hearing and vision care. Some even include dental coverage.
What It Covers
The rules for coverage can change each year. However, most plans establish their own rules and limits. For instance, each plan has its own out-of-pocket costs. They can also set rules regarding referrals to specialists. They can even dictate whether you can visit out-of-network providers in emergency and non-emergency situations.
Medicare generally pays the company you get your care from a fixed amount each month to cover you. Medicare has some set rules that these companies must follow. For instance, every plan must have a maximum limit for how much you pay out-of-pocket throughout the year.
The cap must be reasonable. Its purpose is to protect you from extremely high bills when faced with above-average medical costs. In 2019, the maximum cap can range from $0 to $6,700. That means no plan will have you pay more than $6,700 out-of-pocket.
Some plans may not cost you anything out-of-pocket (aside from your monthly premiums). But, plans with a low out-of-pocket limit will cost more monthly. At the same time, since you must agree to the rules and limitations of the plan, you may score a lower premium. A MA plan will often have lower premiums than a Medigap plan.
What You'll Pay
Even with a Medicare Advantage plan, you still have to pay certain costs associated with Medicare.
- You must continue to pay for Medicare Part B. The cost may vary depending on your income. In 2019, the cost is $135.50/month.
- You must pay a monthly premium for the Medicare Advantage PPO plan. A few select plans have a $0 premium. Your premium may change from one year to the next.
- You will have copays for various medical services. For instance, you might have to pay $20 for a primary care visit. A specialty visit might cost you $50. A hospital copay can cost you daily or it could be one copay for the whole stay.
- You will have to pay 20% to receive most services, like chemotherapy. But, this varies from one plan to the next. Check your Summary of Benefits document for copays and benefits information.
- You may have to pay more for out-of-network services. You may also have to pay a deductible up-front to receive out-of-network services.
- You won't usually have to pay for Part D coverage because it's built into most plans.
Always ask an agent if you have questions about your costs under a specific plan. This allows you to make a more informed comparison.
One thing to keep in mind is that your plan will likely update annually. Every year, you should get a Notice of Change on January 1. This letter could notify you of multiple changes. Your pharmacy network or provider network could change, for example. Your premium, co-payment, and/or co-insurance can also change.
It's your responsibility to review the notice every year and make sure you still have adequate coverage. You should call your agent with any questions you have about your plan's coverage or changes in your plan's coverage.
Comparing PPO to HMO Plans
A popular alternative to a PPO plan is the HMO type plan. These plans are setup differently. However, most companies that offer a Medicare Advantage PPO plan will also offer some form of HMO plan. That's because both are popular. But, they are not at all the same. Here's a look at some key differences.
- A PPO plan doesn't make you select a primary care physician (PCP). Some HMO plans will require you to select one in order to determine the treatment you may need.
- A PPO plan does not require you to see a primary care physician (PCP) before seeing a doctor or specialist. However, some HMO plans may require you to see your PCP before doing so.
- Some HMO plans require you to see your PCP and get a referral. This is common before making a specialty appointment or getting a test done.
- You will still have coverage if you choose an out-of-network provider with a PPO plan. Meanwhile, a HMO plan offers no coverage if you choose to see an out-of-network provider.
Looking at the above comparison, it may be a clear decision for you. But, it's always important to compare your options and understand what's out there.
When it comes to cost, a HMO plan will generally be significantly cheaper than a PPO plan. After all, a HMO plan will usually have a low deductible or possibly no deductible at all. The monthly premium will also be lower for a HMO plan compared to a PPO plan.
But, you have to consider the restrictions that a HMO plan will bring. Some people can justify the restrictions and work with them. Others would rather pay more for a PPO plan and enjoy more flexibility.
Find The Perfect Plan
While Medicare must approve any company offering a MA plan, prices vary. That's why it's important to shop around. Quick Medigap can help you find and compare carriers in your area. Start by entering your zip code and you'll see your options in under two minutes.