Medicare PPO plans are a type of Medicare Advantage policy in which beneficiaries can enroll. These plans can give you the freedom to see doctors outside of networks without having to pay the full cost of coverage out-of-pocket.
Medicare Advantage plans are sold by private insurance companies, so they may have different costs and features. Medicare PPO plans give you more flexibility in managing your health care but can come at a higher cost.
What is a Medicare Advantage PPO Plan?
An essential feature of a Preferred Provider Organization (PPO) plan is its network of doctors, hospitals, and health care providers. If you visit a provider in the plan’s network, the copays, coinsurance, or other costs are billed at an in-network rate.
However, if you use health services outside of your network, you will pay higher out-of-network costs. Thus, when you enroll in a Medicare PPO plan, you can see any provider you wish, but if the visit is out of network, your costs could be higher.
To cap your out-of-pocket costs, Medicare PPO plans have an out-of-pocket maximum in place. This sets a specific dollar amount as the most you can spend out of your own pocket for health care on your plan during a calendar year. Once you reach the out-of-pocket maximum, the Medicare PPO plan picks up 100% of your health care costs.
With a Medicare PPO plan, you typically will not need a referral from your primary care doctor to see a specialist. Many Medicare Advantage PPO plans include prescription drug coverage, and some even offer vision and dental benefits.
Because Medicare PPO plans are sold by individual insurance companies, the costs, out-of-pocket maximums, and types of plans available will vary depending on the insurance company, plan, and service area.
Medicare Advantage PPO Eligibility
Joining a Medicare Advantage PPO plan is simple. To enroll, there is no need to answer underwriting health questions. To join a Medicare Advantage PPO plan, you must first enroll in Original Medicare. If you are enrolling for the first time, you can do so during your Initial Enrollment Period.
If you have previously enrolled in Medicare and are looking to switch to a Medicare Advantage PPO plan, you can do so during the Annual Enrollment Period every year from October 15 through December 7.
Keep in mind, if you are outside either of these enrollment periods, you may not make a change to your plan unless you qualify for a Special Enrollment Period.
Medicare PPO Plan vs. Medicare HMO Plan
When it comes to cost, Medicare PPO plans tend to have a higher monthly premium and deductible than Medicare HMO plans. This is due to the flexibility of coverage.
Similar to Medicare PPO plans, Medicare HMO plans have a network of health care providers. However, with an HMO plan, you do not have coverage if you see a doctor outside of your plan’s network. You typically must choose your primary care provider from your plan’s network. You may pay the full cost of care if the doctor you choose does not accept your plan.
A Medicare PPO plan beneficiary may see non-network providers. However, it costs more than staying within the network. HMOs usually operate with a network of local healthcare providers. Some PPOs may have broader networks.
Medicare PPO Vs. Original Medicare
A Medicare Advantage PPO plan must cover the same types of services as Original Medicare. However, the main difference between the two is that Original Medicare runs through the government. On the other hand, Medicare Advantage plans are available through private insurance companies.
This means that the premiums and out-of-pocket costs for Medicare Advantage PPO plans may vary.
Unlike Medicare Advantage PPO plans, Original Medicare does not have provider networks. You can see whatever health care provider you want, as long as the provider accepts Medicare assignment.
So, no matter which doctor you see, you will always pay the same price. However, if a doctor does not accept Medicare, you will need to pay the full cost of services on Original Medicare or a Medicare PPO plan.
When you enroll in Original Medicare, you are eligible to enroll in a Medicare Supplement plan to help cover out-of-pocket costs. However, you cannot get a Medicare Supplement plan if you have a Medicare Advantage PPO plan – or any Medicare Advantage plan.
How to Enroll in a Medicare Advantage PPO Plan
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- Preferred Provider Organizations, Medicare. Accessed March 2022.