How does a PPO compare to Original Medicare?
Medicare Advantage Insurance Plan (Part C) PPOs (Preferred Provider Organizations) and Original Medicare Part A & Part B are slightly different.
1. Your Coverage Options. Medicare Advantage (Part C) PPOs and Original Medicare Part A & Part B cover your care from most doctors and hospitals in the country. However, Medicare Advantage PPOs must cover your out-of-network care, but you may pay more if you see an out-of-network provider.
2. Your Benefits. Medicare Advantage PPOs must offer all of the same benefits available under Original Medicare Part A & Part B. Many Medicare Advantage PPOs provide additional benefits such as Medicare prescription drug coverage (Part D). If you are in a Medicare Advantage PPO, you must get your drug coverage from that same company, or insurance carrier. PPOs also may offer benefits that are not covered by Original Medicare Part A & Part B, such as dental, vision and hearing coverage, transportation, or gym membership discounts.
3. Your Premium. In Original Medicare Part A & Part B, you will only pay the Part B premium. Medicare Advantage PPOs generally charge a monthly premium in addition to the Original Medicare Part B premium. The premium of your Medicare Advantage PPO may be higher if the PPO offers prescription drug coverage (Part D) benefits.
4. Your Out-of-pocket costs. With Original Medicare, Part A & Part B, you pay 20% coinsurance for doctors’ and other medical services. With a Medicare Advantage PPO, you pay a fixed amount for services, known as a copay, if and when you receive in-network care and a coinsurance when you receive out-of-network care. If you only see doctors and other providers in the PPO’s network, your out-of-pocket costs may be lower than in Original Medicare Part A & Part B. Additionally, PPOs must have an in-network and out-of-network limit on how much you will pay out of pocket, this is called a maximum out-of-pocket amount. These limits can sometimes be high but will protect you from extreme costs if you have a lot of medical care or expensive treatments. For certain kinds of care, or if you receive care from non-network providers, Medicare Advantage PPOs may also charge you higher cost-sharing than Original Medicare Part A & Part B.
For this reason, many people who have Original Medicare also purchase a Medigap plan (or Medicare Supplement Insurance Plan) to help pay some of their costs (such as deductibles and coinsurance). Medicare Supplement Insurance Plans do just as their name implies. They are supplemental insurance policies that work specifically with Original Medicare Part A & Part B. However; you can not enroll in a Medigap and a Medicare Advantage PPO together.
For more information regarding Medicare Advantage, Original Medicare Part A & Part B, or Medicare Supplement Insurance Plans — please contact a licensed insurance agent at Medicare Pathways! Call us at 866-466-9118 now to learn more or complete a no-cost, no-obligation annual Medicare health plan review.
