Is Medicare+Choice the Right Choice for You?

Medicare is the only national health insurance program. Persons eligible for Social Security retirement insurance who are 65 years of age or older are entitled to receive Medicare benefits.

Medicare currently has three “Parts”: Parts A, B, and C. Part A provides hospital, skilled nursing, and hospice services, along with some home health care services. Part B provides for services in a non-institutionalized setting, such as physician services.

Upon attaining age 65, an individual who receives Social Security retirement insurance is automatically enrolled in Medicare Part A and will be deemed to have enrolled in Medicare Part B, though Part B coverage is optional. Part B coverage is financed with premiums paid by persons enrolled in the program. In 2001, the Part B monthly premium is $50; for most, the premium is simply deducted from their monthly Social Security check.

Part C, or Medicare+Choice, was added to the Medicare program effective January 1, 1999. Medicare+Choice was designed to expand the available options for receiving Medicare benefits. Medicare+Choice attempts to accomplish this goal through a variety of health plans, such as health maintenance organizations (HMOs) and preferred provider organizations (PPOs).

By law, Medicare+Choice plans must provide the services currently available to a participating member in Parts A and B. Medicare+Choice may offer supplemental benefits to a participant and a separate premium for such benefits may be charged; however, the separate premium may not vary amongst individuals enrolled in the plan.

For an individual to participate in the Medicare+Choice program, he or she must be entitled to benefits under Part A and enrolled in Part B. Enrollment in Medicare+Choice is optional.

The Medicare+Choice program has several advantages and disadvantages when compared to the traditional, fee-for-service Medicare coverage options under Parts A and B. An individual considering enrolling in the Medicare+Choice program should bear these factors in mind when making such a decision:

Advantages

(a) HMOs encourage preventative care, including annual check-ups and health care screening services;

(b) HMOs often provide coverage options not available under traditional Medicare, such as prescription drugs, dental care, and hearing exams;

(c) Managed care plans often provide beneficiaries with the services covered under a traditional Medigap policy of private health insurance, eliminating the need of the Medicare participant to purchase private, supplemental Medicare coverage.

Disadvantages

(a) Participants must receive a referral from a primary treating physician to see a specialist and primary physicians have a financial incentive NOT to make such referrals;

(b) HMOs receive the same payment from Medicare whether a Medicare+Choice beneficiary receives services or not, providing a financial disincentive for providers to treat participating members; some providers may treat Medicare+Choice participants differently than traditional fee-for-service Medicare participants;

(c) Beneficiaries cannot go to any physician or hospital they choose but must instead use the HMO participating facility or physician; there are limited locations where a beneficiary can receive care.

Managed care programs are not for every Medicare beneficiary, and you should always make an informed decision when choosing your health insurance coverage. Before deciding to enroll in Medicare+Choice, you should study your options. Here are some things you should do before making your decision:

1. Review the coverage options under your traditional Medicare program, as well as the coverage options under any supplemental or Medigap policies of health insurance you may have purchased.

2. Read each plan’s material to discern their benefits. Determine if there are plan services that are provided at an additional cost and ascertain the cost of those services.

3. If the materials you have on the plan are inadequate, contact the Plan and obtain additional materials.

4. Determine if your physician participates in the managed care plan you are considering.