Medicare Health Plans: Your Options (Plain-English Guide)
Medicare health plans are another way to get your Part A (Hospital) and Part B (Medical) benefits instead of Original Medicare. The most common option is Medicare Advantage (Part C), offered by private companies approved by Medicare. Some plans also include Part D (drug coverage) and extra benefits like dental, vision, or hearing. Plans must follow Medicare rules.
Good to know: Companies must follow Medicare’s marketing and enrollment rules. If a plan contacts you, they have limits on what they can say or do.
At a glance
- You’ll generally use a plan’s network of doctors and hospitals (rules vary by plan type).
- Costs vary by plan: premiums, copays/coinsurance, and annual max out-of-pocket.
- Most Medicare Advantage plans include drug coverage (some do not).
- You keep paying your monthly Part B premium (and any plan premium, if applicable).
Compare common Medicare Advantage plan types
| Type | Network rule | Drug coverage (Part D) | Primary care doctor | Referral required? | Out-of-network use |
|---|---|---|---|---|---|
| HMO (Health Maintenance Organization) | Use in-network providers, except emergencies/urgent care. | Usually included. If not, you generally can’t add a separate Part D plan. | Usually required. | Usually required. | No (except emergencies). Some HMOs offer a Point-of-Service option with limited out-of-network at higher cost. |
| PPO (Preferred Provider Organization) | Lowest costs in network. | Usually included. If not, you typically can’t add separate Part D to that PPO. | Not required. | Not required. | Yes, but you’ll usually pay more than in network. |
| SNP (Special Needs Plan) | HMO or PPO style—varies by plan. | Included in all SNPs. | Varies by plan. | Varies by plan. | Varies. Tailored for dual-eligible, chronic conditions, or institutional care. |
| MSA (Medical Savings Account) | Usually no network. | Not included. You may join a separate Part D plan. | Not required. | Not required. | Yes—any Medicare-approved provider who agrees to treat you and hasn’t opted out. |
| PFFS (Private Fee-for-Service) | Provider must accept the plan’s terms for that visit. | Sometimes included. If not, you can join a separate Part D plan. | Not required. | Not required. | Yes, if the provider accepts the plan’s payment terms for that visit. |
HMO (Health Maintenance Organization)
How it works: Care is coordinated through in-network doctors and facilities. Emergencies and urgent care are covered anywhere. Some HMOs have a Point-of-Service feature that allows limited out-of-network use at higher cost.
- Primary care doctor: Usually required.
- Specialists: Usually require a referral (common preventive screenings may not).
- Drugs: Often included. If the HMO doesn’t include Part D, you generally can’t add a separate drug plan.
PPO (Preferred Provider Organization)
How it works: You pay the least in network, but you can use out-of-network providers who accept Medicare—typically at a higher cost. No referrals needed for specialists.
- Primary care doctor: Not required.
- Specialists: No referral needed.
- Drugs: Often included; if not, most PPOs won’t allow a separate Part D add-on.
SNP (Special Needs Plans)
How it works: Designed for specific groups and include care coordination and tailored benefits.
- D-SNP: For people with Medicare and Medicaid.
- C-SNP: For certain chronic conditions (for example, diabetes, CHF, COPD).
- I-SNP: For people who live in certain facilities or need institutional-level care.
- Drug coverage: Always included.
MSA (Medical Savings Account)
How it works: Combines a high-deductible Medicare Advantage plan with a medical savings account funded annually by the plan. You decide how to use the account for covered care before meeting the deductible. Drug coverage is not included; you may join a separate Part D plan.
- Usually no network—see any Medicare-approved provider who agrees to treat you.
- You manage the account; unused funds roll over year to year.
- Certain situations can prevent MSA enrollment (for example, specific other coverage or hospice status).
PFFS (Private Fee-for-Service)
How it works: The plan sets what it pays and what you pay. Each visit, a provider must accept the plan’s terms. Some PFFS plans use a network; others do not. Drug coverage may or may not be included.
- No primary care doctor or referrals required.
- Out-of-network use depends on the provider accepting the plan’s terms that day.
Other Medicare health plans (not Medicare Advantage)
- Medicare Cost Plans: Available in limited areas. You can use providers in or out of network; costs vary.
- Demonstration/Pilot Programs: Time-limited models testing new ways to deliver and pay for care.
- PACE (Program of All-Inclusive Care for the Elderly): For people who meet nursing-home-level care but can live safely in the community; includes comprehensive medical and social services.
Universal rules and protections
- Emergencies & urgent care: Covered anywhere in the U.S.
- Prior authorization: If a plan approves a treatment, that approval remains valid as long as medically necessary for the same course of care.
- Annual notices: Plans send an Annual Notice of Change and Evidence of Coverage each year listing benefits and costs.
- Certain services: Plans can’t charge more than Original Medicare for categories like chemotherapy, dialysis, and skilled nursing facility care.
Availability & enrollment
- Where plans are offered: Companies choose the counties and plan types to offer; availability can change each year.
- Enrollment periods: You can usually join, switch, or drop plans during Medicare’s enrollment windows (and sometimes during a Special Enrollment Period).
- Employer/union coverage: Check with your benefits administrator before joining; changes can affect retiree or dependent coverage and may be hard to reverse.
Comparing Medicare Advantage vs. Medigap (Supplement)
Medicare Advantage and Medigap solve different problems. Advantage bundles medical (and often drugs) with network rules and an annual max out-of-pocket. Medigap works with Original Medicare to reduce or eliminate many bills—no networks, but separate drug coverage (Part D) is needed. If you’re weighing the trade-offs, start here:
- Get a personalized quote (we’ll compare Medicare Advantage and Medigap side-by-side).
- Review Medigap details by plan letter:
Plan G ·
Plan N - Browse Medigap plans by state: Texas Medigap overview
Need help deciding?
We’ll explain your options in plain English and help you weigh networks, drug coverage, and total costs—no pressure, no spam.
ClickMedigap isn’t affiliated with or endorsed by the U.S. government or the federal Medicare program. This page is for general education – plan details vary by insurer and location. Always review the plan’s official documents before enrolling.