Overview of Medicare Advantage Plans

Medicare Advantage (MA) is also known as Medicare Part C. An MA plan is an alternative to Original fee-for-service Medicare. MA plans are sponsored by Medicare, which pays private insurance companies to provide health services to beneficiaries who enroll in these plans.

In order to join an MA plan, you must be enrolled in both Medicare Part A and Part B, and you must continue to pay the Part B premium. If you join an MA plan, you are still on Medicare and retain the full rights and protections entitled to all beneficiaries.

You receive all Medicare-covered benefits through the private MA plan you choose. Some MA plans offer Medicare prescription drug coverage (these are known as MA-PD plans), but other plans do not (these are known as MA-only plans). If you join an MA-only plan, you may or may not join a separate Medicare Part D plan depending on the type of MA plan you join.

Note: Since 2022, MA plans can offer a hospice benefit, though many still do not. If hospice coverage is not offered through your MA plan, you can access it separately through Original Medicare.

On this page, we’ve compiled information on the 3 types of Medicare Advantage plans:

  1. Health Maintenance Organizations (HMOs)
  2. Preferred Provider Organizations (PPOs)
  3. Special Needs Plans (SNPs)

Note: Some employer-sponsored and retiree plans offer health coverage through MA plans. See Medicare & Other Health Insurance for more information.

1. Health Maintenance Organizations (HMOs)

If you enroll in a Medicare HMO, you will be required to use only doctors and facilities that contract with your particular HMO. You will have a primary care doctor who manages your health care needs. Before you see a specialist in your HMO network, you must generally get a referral from your primary care doctor (except for an OB-GYN). This requirement is waived for emergency care and out-of-the area urgent care. If your current doctors are not under contract with the HMO, you must select new physicians who are part of the HMO network.

If you want to see a doctor outside the plan (known as an out-of-network or non-preferred doctor), and you do not have a pre-approved referral, you are responsible for the cost. Most likely, neither your HMO plan nor Medicare will cover the cost.

Some HMOs offer a Point-of-Service (POS) option that allows you to see doctors outside the plan’s network, often for an additional cost. HMOs that offer this option may also limit when you can use it.

Some HMOs offer Medicare Part D prescription drug coverage and others do not. If you are in an HMO plan that does not offer Part D coverage, you generally cannot get other Part D coverage outside of your plan. See Prescription Drugs for more information.

HMOs are the most popular type of MA plan in California, but they are not available in every part of the state. In 2023, 52 counties have at least one HMO plan. And six counties have no HMO. The counties with no HMO include: Alpine, Calaveras, Colusa, Lassen, Sierra and Trinity.

The State of California Office of Patient Advocate website has additional information and advocacy tools to help you understand your rights and get the most out of your plan, including health care quality report cards on health plans and medical groups: opa.ca.gov.

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2. Preferred Provider Organizations (PPOs)

Medicare PPOs — like Medicare HMOs — have networks of providers. If you see providers in the network, you will pay a lower copayment than if you go to providers outside the network (these are known as out-of-network or non-preferred). If you see providers outside the network, the plan still covers you but you pay higher cost-sharing than if you see network providers. In a PPO, you generally do not need a referral to see a specialist or an out-of-network provider.

In 2023, local PPO plans are available in 51 counties in California. All the local PPO plans offer prescription drug coverage. There are no statewide PPO plans offered in 2023.

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3. Special Needs Plans (SNPs)

Medicare SNPs are designed for certain populations. These include:

  1. C-SNPs  for people with certain chronic or disabling conditions;
  2. D-SNPs — for people who are eligible for both Medicare and full Medi-Cal (“dual eligibles”); and
  3. I-SNPs — for people in certain institutions (like a nursing home) or who still live at home but need the same level of care as someone living in a nursing home.

The goal of SNPs is to provide coordinated health care and services to those who can benefit the most from the special expertise of the plans’ providers and focused care management. All SNPs must provide Medicare prescription drug coverage, and most SNPs offer more benefits than Original Medicare.

In 2023, C-SNPs are available in 50 counties, D-SNPs are available in 38 counties, and I-SNPs are available in 26 counties across the state. See the Centers for Medicare and Medicaid Services website for county-specific information, or call your local HICAP at 1-800-434-0222.

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See also