The recent changes in the U.S. healthcare system have extended the coverage scope of Medicare and the program continues to grow and provide benefits. You can get your Medicare coverage through Original Medicare or the different private Medicare Advantage plans. You can also enhance your Medicare coverage with the Medicare supplements in Phoenix AZ.
The concept of medicare supplements in Phoenix AZ
Medicare is the national health insurance program, administered by the federal government through private insurance companies across the country. The program is available to all U.S. citizens who are 65 years of age or older, including seniors with a permanent resident status of at least 5 years. People under 65 receiving disability insurance benefits and people of any age with certain qualifying conditions (dialysis patients, kidney transplant candidates and ALS sufferers) are also eligible.
How is Medicare structured?
Medicare has 4 parts (A ,B, C and D), each covering a different aspect of medical care. Parts A and B are known as Original Medicare.
Part A (hospital insurance) covers inpatient care in hospitals, skilled facilities and home care.
Part B (medical insurance) covers outpatient care, doctor visits, medical equipment and preventive care.
Part C (Medicare Advantage or MA) offers all the benefits of Original Medicare, but is run by Medicare-approved private insurance companies.
Part D (Medicare Prescription Drug Plan) subsidizes the costs of prescription drugs. Similar to Medicare Advantage, it is administered through private insurance companies.
Seniors aged 65 and older who have paid 10 years of social security taxes can receive their Part A insurance benefits premium-free.
Medicare plans can change the coverage scope, costs, pharmacies or providers in their network annually. You should stay up-to-date with the changes in your plan to make sure it still meets your needs next year.
Types of Medicare Advantage plans
Health Maintenance Organization (HMO) plans: Your choice of doctors and hospitals is restricted to the HMO network, except in emergencies. A referral may be required for certain tests or specialist appointments.
Preferred Provider Organization (PPO) plans: In addition to medical care within the PPO network, you can choose doctors or hospitals outside its scope, but it will cost you more.
Private Fee-for-Service (PFFS) plans: You can go to any doctor or hospital that agrees to treat you. The plan determines yours and their share of the costs.
Special Needs Plans (SNPs): These plans focus on medical care for specific population groups, including people suffering from chronic conditions, nursing home residents and dual beneficiaries of Medicare and Medicaid.
HMO Point-of-Service (HMOPOS) plans: For a higher copayment and coinsurance, you can receive certain services outside the network.
Medical Savings Account (MSA) plans: These plans are a combination of a high-deductible plan and a bank account. Medicare deposits money into the account and the policyholder uses these funds to pay for medical care.
How Medicare Advantage plans work
Medicare Advantage is another way to get your Medicare coverage. If you join an MA plan, you’ll get all your Part A and Part B benefits through the plan, not through Original Medicare.
Part C plans are run by private local or regional plans, approved and regulated by Medicare.
You can join an MA plan when you are first enrolled in Original Medicare or during the annual open enrollment (Oct 15 -Dec 7).
Medicare Advantage plans usually include Medicare prescription drug coverage at no additional cost.
If your MA plan includes drug coverage and you join a Medicare Part D plan, your MA policy will be cancelled and you’ll be returned to Original Medicare.
Note: All Medicare Advantage plans cover emergency care.
In addition to your Part B premium, you usually pay a monthly premium for your Medicare Advantage Plan.
Each month, Medicare pays a fixed amount to your Medicare Advantage provider, regardless of the amount of medical care received. You pay what the plan requires for each service.
All MA providers must follow certain Medicare rules. However, they have the right to set their own out‑of‑pocket costs and rules regarding their services.
These rules can change annually. Your MA plan will keep you updated about any changes in the coverage, costs, provider networks and service area through the Annual Notice of Change.
MA plans have different monthly premiums, co-payments, coinsurance and out-of-pocket limits. The monthly costs and availability of MA plans in Arizona vary from county to county.
Your Medicare Advantage plan can’t charge you more than Original Medicare for certain services like chemotherapy, dialysis, and skilled nursing facility care.
Providers can join or leave your plan’s network and your plan can change the providers at any time of the year. If this happens, you may need to choose a new provider.
When to consider a Medicare Advantage plan
Choosing the optimal health coverage option requires careful consideration of each plan’s specifics. Additionally, you have to take into account your current health status, financial stability and potential health concerns. It is wise to consider an MA plan in the following scenarios:
- Original Medicare doesn’t cover prescription drug costs. To get drug coverage, you’d have to purchase a separate Medicare Part D plan. In contrast, the majority of MA plans include drug coverage. The medicare.gov site has online tools where you can compare different plans and check how much you’d pay for your medications.
- Original Medicare has no limit on the costs you’d have to pay out-of-pocket. In other words, you pay a portion of the costs each time you receive medical care. Medicare Advantage plans are required by law to set an out-of-pocket maximum. Once you reach this limit, your plan will cover all your expenses.
- Original Medicare charges a 20% coinsurance. Due to the different cost structure of Medicare Advantage, this amount could be lower or the plan may charge a co-payment instead of coinsurance. Co-payments are fixed amounts you pay for medical care. Lower costs are usually compensated by higher monthly premiums.
- Some Medicare Advantage Plans offer dental care, vision and hearing services, wellness programs, assisted living facilities and nursing home care. These services are not covered by Original Medicare.
- If you want to enhance your Original Medicare coverage, Medicare Advantage is an alternative to the private Medigap supplemental plans. Medigap plans are designed to help with the deductibles, co-insurances and co-payments in Original Medicare. Depending on your particular needs, Medicare Advantage could be better suited for you than Medigap. Familiarize yourself with both alternatives so you can make the right choice.