Understanding HMO's
An alternative to a Medigap policy from regular insurance carriers is membership in a health maintenance organization (HMO), or a competitive medical plan (CMP). These organizations contract with Medicare to provide services to Medicare recipients who select that type of coverage.
As the name implies, these organizations believe in and stress preventive medicine. With only a few exceptions, neither Medicare nor most insurance plans give more than lip service to prevention. The most obvious example is the refusal of Medicare, and thus most insurance plans, to pay for physical examinations. By contrast, it is not uncommon for HMO's to require regular physicals.
HMO's and similar organizations charge the member regular premiums that may range from $50 to more than $200 per month, and modest coinsurance payments. For example, each visit to a doctor may cost a few dollars as a kind of deductible. Just as with regular Medigap plans, the service you receive varies according to the size of the premium.
Since 1990, most HMO's and CMP's that enrolled Medicare beneficiaries are required by law to provide certain benefits, not available under fee-for-service Medicare, at no additional charge to the member. These include extended hospital and skilled nursing facility stays, expanded home health benefits, respite care, and coverage for certain drugs. In addition, many of these organizations offer such services as dental care, hearing testing and hearing aids, and refractions for eyeglasses.
MEDICARE REQUIREMENTS FOR COVERAGE IN AN HMO:
- You must be enrolled in Medicare's medical insurance (Part B) and continue to pay the premiums.
- You must live within the area serviced by the HMO or CMP.
- You will usually be required to receive all care from the HMO or CMP, except in emergency or urgent situations.
- You cannot enroll in an HMO or CMP if you have chronic kidney disease. But if you are a member of an HMO or CMP when you develop chronic kidney disease, the care you need will be provided through the organization.
- If you have elected hospice care, you may not enroll in an HMO or CMP as long as the hospice election remains in effect. However, when you are already a member of an HMO or CMP, you may elect hospice and continue in the organization's plan. In that case you must receive all care related to your terminal illness from the hospice and not the HMO or CMP.
It is important to understand that you are not locked into membership in one of these organizations. If you decide that you prefer fee-for-service Medicare, you can drop the HMO or CMP plan in any month and transfer to regular Medicare at the beginning of the next month. In such a case, be sure that Medicare knows of the change and it would be prudent to arrange for some alternative supplementary insurance before you make the change.
ADVANTAGES OF MEMBERSHIP IN AN HMO OR CMP:
- Preventive medicine.
- Other health services such as dental care and routine eye care.
- Broader coverage generally than most Medigap insurance.
- Less paperwork than conventional insurance.
- Responsibility of an organization for your healthcare as opposed to individual practitioners.
DISADVANTAGES OF MEMBERSHIP IN AN HMO OR CMP:
- You must live near where the service is offered, i.e., clinics and hospitals.
- You have a more limited choice of staff than in a fee-for-service plan.
- There may be greater delays for certain services such as elective surgery.
- You may not be able to get the HMO to perform a service that you desire, such as certain elective surgery.
WHAT TO LOOK FOR WHEN YOU SELECT AN HMO OR CMP:
These organizations range from highly integrated healthcare facilities such as Group Health and Kaiser-Permanente to organizations that are made up of cooperating independent doctors and healthcare ser-vices. One example of the latter is the individual practice association (IPA) wherein private doctors treat the patient in their own offices with costs and benefits arranged through membership in the HMO. In addition to the organizational structure of the HMO, you should inquire about the following:
BASIC SERVICES
In addition to regular Medicare-authorized service, will you be able to have physical examinations; eye refractions and glasses; hearing examinations and hearing aids; prescription drugs; dental care; and podiatric care? You should also inquire about the limitations on hospital stays.
EXTENDED SERVICES
How does the HMO provide for emergency care that you may require outside of their facilities? How about treatment while traveling in and out of the United States? If a second opinion is needed about your condition will it be authorized without extra cost, including an outside physician? If an HMO doctor refers you to an outside specialist will the plan pay the cost? For those interested, is chiropractic care provided for? What are the benefits for mental healthcare? How does the HMO manage care for degenerative diseases such as Alzheimer's?
OTHER CARE CONSIDERATIONS
What are the provisions for urgent or emergency care? How long must one wait for an appointment for nonurgent care? Can you change staff doctors with minimum trouble if you are not satisfied? Are most primary-care physicians accepting new patients? Are most specialties represented on the staff and are they board-certified? What does the HMO do to orient new members to its services, procedures, and appeal routine? Does it publish an easily understood and clear members handbook? Are there tours or open houses from time to time when a new or prospective member may become familiar with the facilities? Is there a special effort to clarify Medicare coverage and procedures? Can you get to the HMO easily on public transportation? Is there provision for homebound patients?
OTHER QUALITY CONSIDERATIONS
Can you get in contact with members of the HMO to determine their assessment of the services offered? Does the organization appear to be well run in terms of reception of patients and the providing of information in the offices and over the phone? Is the office clean? Are there comfortable waiting areas and well-equipped examination rooms? Is the staff courteous and helpful? You may have special questions you wish answered that have not been suggested. If so, add them to the list and make an effort to find the answers before you sign up. By the same token, many of the above questions can be applied to any system of healthcare and insurance you may consider.
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