Medicare is a federal program for those who are over 65, disabled or have end-stage renal disease (ESRD). It has two forms:

1. Original Medicare, which consists of hospital insurance (Part A) and insurance for doctors and other health services (Part B) 
2. Medicare Advantage (Part C), which must cover everything that Original Medicare covers, but are administered by private Medicare insurance plans that contract with the government 

Part A is free for most people, Part B requires a monthly premium, and Part C may charge a premium on top of Part B. Part D covers prescription drugs and is often included in Part C plans. When you choose one of these options, you “buy Medicare.” When you consult a licensed health care broker, you are seeing an insurance agent who can help you buy Medicare insurance. 

Parts A and B are managed directly by the Centers for Medicare & Medicaid Services (CMS). Parts C and D, in contrast, are insurance plans provided by private insurance companies that contract with and are paid for, in whole or in part, by the federal government. 

Medicare supplement plans, also called Medigap, do not replace Original Medicare like Medicare Advantage plans do, but help pay for what Original Medicare does not cover, primarily the deductibles and copayments (see below for more on this). Patients who are on Medicare due to ESRD usually cannot enroll in a Medicare Advantage plan, unless it is a Medicare Advantage Special Needs Plan (SNP) that specifically serves people with ESRD. SNPs must meet additional specific requirements set by the government every year.  

 

What is Best for Me?

Choosing the right plan for you depends on a number of factors – what services do you need? Which plans are available in your area? Which providers accept patients under those plans? What are the monthly premiums? What are the deductibles? What are the copayments? Is there a cap on your out-of-pocket costs? What are your total monthly payments likely to be? How can you select the best health care providers? 

Depending on where you live, you may have only a few plans to choose from or a wide variety of them. It can be helpful to consult with a Medicare insurance broker who represents a number of plans and can help you determine which choices are best for you. The following sections give a little more detail on what to ask them to help you find the Medicare plan for you.

 

What Services Do I Need?

Beginning in 2019, Medicare Advantage plans will be reimbursed for offering a number of additional services that Original Medicare does not cover: home delivery of meals, modifications to the home to assist mobility, non-emergency transport to medical appointments and non-custodial care in the home. If you have limited mobility or require assistance, this can be an important consideration. If you have multiple chronic conditions and need these supplemental services, you should discuss this with your insurance broker.

 

Who’s in the Provider Network?

It is possible that doctors and health facilities you have used for years may not accept every Medicare Advantage plan. You need to check and see if they accept the plan you are considering and, if not, which plans they do accept. The same applies to hospitals. The plan you choose may not cover out-of-network providers or may charge a higher deductible and copayment for using them.

 

Are There Deductible and Copayments?

Deductibles are the amount that your plan charges before any health care costs are covered. For Original Medicare, it varies by service (hospital, doctor, medical equipment, etc.), and there is no out-of-pocket limit for what you may have to pay in a year. Copayments are the portion of the charge that you are responsible for after your insurance has paid the bulk of the bill. Again, in Original Medicare, there is no out-of-pocket limit on copayments. Medicare Advantage plans do have out-of-pocket limits, but they vary by plan and may change from year to year.

 

What Types of Medicare Advantage Plans Can I Choose From?

Most providers take Original Medicare. Medicare Advantage plans are organized in different ways in how their members access various providers. Medicare Advantage plans that are organized on the health maintenance organization (HMO) model typically require you to see one primary care provider and get referrals to see specialists. These plans typically do not pay anything if you use an out-of-network provider. Plans that have a wider panel of providers called preferred provider organization (PPO) plans typically allow you to see any in-network provider without a referral, but charge more for seeing out-of-network providers. Plans that are organized on a fee-for-service (FFS) basis typically allow you to see any provider and offer the same amount of coverage for any provider.

 

Who’s the Best Provider? Who Has the Best Plan?

Medicare rates hospitals, nursing homes, and hospice programs on a five-star rating system, with 5 being the best. Ratings for hospitals can be found at Medicare Hospital Compare. Medicare also rates Medicare Advantage plans on a five-star rating system every year, with 5 stars being the highest rating a plan can receive. Ratings can be found at Medicare Advantage Plan Ratings. 

 

Now That I Know All This, What Do I Do?

The information we presented above, combined with the rating sites, can be overwhelming. We strongly recommend that you consult an insurance broker, who represents a range of Part C and D plans and Medicare supplement plans, to help you make your choices.