Healthcare Uncovered Episode 7: Medicare vs. Medicare Advantage: What Doctors Need to Know

Doctors, do you really know what the key differences are between Traditional Medicare and Medicare Advantage? The names might sound similar, but these are two very different healthcare programs. I break down all of the differences in this week’s episode of Healthcare Uncovered.

Medicare Advantage is on the move. It has grown from less than 20% of the health insurance market for seniors to 50%. In fact, Medicare Advantage is now equal in size to Traditional Medicare.  But it’s not stopping there. Medicare Advantage is expected to be 70% of the total senior health insurance market by 2030.

So, it’s really important that doctors know the difference between Traditional Medicare and Medicare Advantage. Here are some main differences you’ll want to know:

Traditional Medicare:

• Fee-for-service.
• Centers for Medicare and Medicaid Services (CMS) sets the reimbursement for all services.
• As long as it is a covered service, the doctors just need to bill Medicare and Medicare will pay.
• Traditional Medicare Does NOT have prior authorizations or referral requirements to see specialists.

Medicare Advantage:

• CMS gives a fixed amount per patient per month to a commercial health insurance company.
• Medicare does not pay doctors directly.
• The health insurance company negotiates fees with doctors, hospitals, and other healthcare providers to create a network.
• This network is different than a health insurance company’s other networks for people who are under 65 and are insured through their employer. Think of Medicare advantage as something of a hybrid between a traditional government program and commercial insurance.
• For doctors and hospitals that DO agree to Medicare Advantage, there are often prior authorization and referral requirements for medications, tests, procedures and specialist visits.

So, in summary, Medicare Advantage is health insurance for seniors. It’s an alternative to Traditional Medicare and it’s growing in popularity. It pays doctors about the same as Traditional Medicare, but it has prior authorization and referral requirements that doctors generally don’t like.

There are more nuances between the two plans and I break it all down for you in Episode 7 of Healthcare Uncovered.

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