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Medicare: Part C

Congress significantly restructured the Medicare program with the establishment of Medicare Part C, the Medicare+Choice program (now referred to as Medicare Advantage). Medicare offers beneficiaries the following private health care delivery options: Medicare health maintenance organizations (HMOs), medical savings accounts (MSAs), preferred provider organizations (PPOs) (regionally expanded in 2006), private fee-for-services (PFFS), and provider sponsored organizations (PSOs). However, individuals are only eligible to elect a Medicare Advantage plan offered by a Medicare Advantage organization (MCOs, referring to the prior designation of Medicare+Choice) if the plan serves the geographic area in which the individual resides.

Beneficiaries who reside in an area served by a Medicare Part C plan may opt out of either Part A or Part B and elect to enroll in Medicare Part C, except those with end-stage renal disease. Beneficiaries may only enroll during November of each year, and plan elections become effective in January of the following year. Beneficiaries who do not elect any option will automatically be enrolled in traditional fee-for-service Medicare. If a beneficiary does not make an election for a particular year and is already enrolled in Part C from the previous year, he or she will automatically be re-enrolled in that plan. Beneficiaries can also change plans if their plan contract terminates or if they move from their plan’s service area. 42 U.S.C.A. section 1395w-21(e)(3).

The Secretary of Health and Human Services has established a process through which elections under Medicare Part C are made and changed. Individuals seeking to elect a an must complete and sign an election form, provide the information required for enrollment, and agree to abide by the rules of the Medicare Advantage program. Within 30 days from receipt of the election form, MCOs transmit the information necessary for CMMS to add the beneficiary to its records as an enrollee of the MCO. A beneficiary’s enrollment may not be terminated unless the beneficiary engages in disruptive behavior, provides fraudulent information on the election form, permits abuse of the enrollment card, or fails to pay premiums in a timely fashion. Part C monthly premiums are calculated based on the rules set forth in 42 U.S.C.A. section 1395w-24(b)(1)(A).

A plan offered by an MCO satisfies the basic requirements for benefits and services if the plan provides payment in an amount that is equal to at least the total dollar amount of payment for such items and services as would otherwise be authorized under Medicare Parts A and B. The plan must also comply with (1) CMMS’s national coverage decisions and (2) written coverage decisions of local carriers and intermediaries for jurisdictions handling claims in the geographic area for which services are covered under the plan.

Inside Medicare: Part C