Medicare HMO plans are a popular managed-care option in America. According to the Kaiser Family Foundation, approximately 30% of Medicare beneficiaries are enrolled in some type of Medicare Advantage plan.
Medicare HMOs are common because of the lower premiums they often offer. In some plans, that premium may be as low as $0. However you must still be enrolled in and paying for Medicare Part B. You usually must also treat with in-network providers except in the case of an emergency.
What is a Medicare HMO?
Medicare HMOs are health maintenance organizations through which Medicare beneficiaries can access their Medicare services. They are often called Medicare managed care plans because your care is managed through a network of doctors and hospitals specific to the plan.
The insurance company contracts with certain doctors and physicians in your local area to form a network. You will select a primary care physician (PCP) who will coordinate your care.
If your PCP is unable to treat a health condition, he or she will issue a referral for you to see a specialist network. Some services like preventive care, mammograms and emergency visits may not require a referral. Some plans may not require referrals for specialty care.
As mentioned above, Medicare HMO plans do not replace Part B. You must first be enrolled in both Medicare Parts A and B before you can enroll in a Medicare HMO. You must also live in the plan’s service area.
When you enroll in a Medicare HMO, you agree to obtain your care through the plan’s network, except in emergencies. Some plans have an HMO-POS feature. An HMO-Point of Service is a hybrid between HMO and PPO plans. In a POS plan, you can see providers outside the network for certain healthcare services and in certain situations, such as traveling. Always confirm with your plan how their POS feature works in that plan because it can vary.
If a Medicare HMO feels too restrictive to you, consider a Medicare PPO plan which has more flexibility.
Medicare HMO plan Common Features
- Medicare HMO applications have only one health question. Anyone can enroll during the proper election periods as long as you don’t have End-Stage Renal Failure.
- Premiums may be lower than Medigap plans in your area. Some plans in some areas may even have a $0 premium. However, premiums can change from year so it’s important to always review your Annual Notice of Change letter each fall. This letter will tell you the upcoming changes in the Medicare HMO plan for the next year.
- Local network of healthcare providers and hospitals from which you must seek your care, except in emergencies. Many plans will have you choose a primary care physician. That doctor can coordinate a referral to send you to a specialist when needed. Some insurance companies offer HMO-POS plans. These point-of-service plans may also some out of network services at higher copays.
- Medicare Part D drug plans are included in many HMO plans. You should always check the plan’s drug formulary to make sure your medications are included in the plan.
- You pay as you go in the form of co-pays or coinsurance. Each plan has a benefit summary which will tell you how much the provider is allowed to charge for certain services. Copays vary for services like doctor’s visits, lab-work, and inpatient hospital care
- Annual Changes – The benefits formulary, pharmacy network, provider network, premium and/or co-payments/co-insurance may change on January 1 of each year. It’s important that you do your homework in reviewing plan changes from year to year.
Medicare HMOs are generally the most restrictive type of Medicare Advantage plan. There are no out-of-network benefits except in an emergency. All Medicare Advantage plans have certain limitations and restrictions by which you must abide. You can read more about these rules on our general Medicare Advantage page.
How Do Medicare Advantage Companies Make Money?
Medicare Advantage plans are paid by Medicare to take on your medical risk. This is why you must remain enrolled in both Medicare Parts A and B while enrolled in a Medicare Advantage plan. They money that you pay for Part B goes toward paying that Advantage company to insure you. Since the Medicare Advantage HMO carrier is getting paid by Medicare for your enrollment, they will offer you premiums as low as possible to attract you to the plan.
Medicare itself is not responsible to pay for any of your services once you enroll in a Medicare Advantage plan. Your providers must bill the Medicare Advantage company.
Which Insurance Companies Offer Medicare HMO plans?
Medicare HMO plan availability varies by state and county. Dozens of well-known insurance companies offer plans, such as Aetna, Anthem, Blue Cross Blue Shield, and Cigna. We can check plan availability in your county.
Which Medicare Advantage Plan is Best?
Many of our clients often ask us to tell them which Medicare Advantage plan is best. If only it were that simple! Choosing the right Medicare Advantage plan is very much an individual thing. A plan might be perfect for you but not great for your neighbor because her doctor isn’t in the network. Another plan might have great prices for diabetes medications, but doesn’t work out so well for someone who takes a different set of medications. Checking your doctors and prescriptions is the first step in determining which plans will work for you.
Medicare does give Medicare Advantage plans a star rating. Much of this rating is based on feedback of current plan members. Five stars is the highest rating, but is not all that common. 3 and 4 star plans are very common. If a plan has a rating lower than 3, it must notify its members and those members can change out of that plan mid-year.
Learn more about Medicare HMO plans
Reviewing each HMO plan one by one is a tedious chore. Get help from a licensed insurance agency that specializes in Medicare products. A qualified agent can provide important information such as a plan’s network size and service area. We also go over the Medicare HMO plan’s star rating and history in the marketplace. Most importantly, they’ll tell you whether your physicians participate in the plan.
Experienced agencies also can help you consider factors specific to you. For example, we’ll review whether the plan has a built-in Part D drug formulary that includes your medications.
We’d love to be your agent so contact us for help today!