DEFINITIONS
of Insurance Plans Types
What is it?
An HMO is a type of Medicare Advantage plan where you usually need to get care from doctors, hospitals, and providers within the plan’s network. In most cases, you’ll also choose a primary care doctor to help manage your care.
Key Features of HMO Plans
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Network Rules – You must use doctors, hospitals, and other providers in the plan’s network, except for emergencies, out-of-area urgent care, or temporary out-of-area dialysis.
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HMO-POS Option – Some HMO plans (called HMO Point-of-Service) let you get certain services outside the network, but you may pay a higher copayment or coinsurance.
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Prescription Drugs – Most HMO plans include Part D drug coverage. If you want drug coverage, you must join an HMO that offers it. You can’t add a stand-alone Part D plan to an HMO without drug coverage.
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Primary Care Doctor – In most HMOs, you need to choose a primary care physician (PCP).
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Referrals – In most HMOs, you need a referral from your PCP to see a specialist. Some preventive services (like mammograms) don’t require referrals.
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Important to Know
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If you get non-emergency care outside the network without authorization, you may have to pay the full cost.
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Plans may require prior approval (authorization) for some services.
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Always check your plan’s rules or visit Medicare.gov/plan-compare for details on coverage and costs.
Medicare HMO (Health Maintenance Organization)
What is it?
A PPO is a type of Medicare Advantage plan that gives you more flexibility. You can use doctors, hospitals, and other providers both inside and outside the plan’s network, but you’ll usually pay less if you use in-network providers..
Key Features of PPO Plans
Key Features of PPO Plans
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Network Rules – You can get care from both in-network and out-of-network providers. Out-of-network services usually cost more.
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No Primary Care Requirement – Unlike HMOs, you don’t have to choose a primary care physician.
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No Referrals – You don’t need a referral to see specialists.
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Prescription Drugs – Most PPOs include Part D drug coverage. If you want drug coverage, you must join a PPO that offers it. You can’t add a separate drug plan if your PPO doesn’t include one.
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Comprehensive Coverage – PPOs cover everything Original Medicare covers, and most plans offer extra benefits like dental, vision, or hearing.
Important to Know
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Using out-of-network providers may result in higher copayments or coinsurance.
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Each PPO sets its own out-of-pocket maximum, which protects you from very high costs in a plan year.
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Plans may require prior approval (authorization) for some services.
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Always check your plan’s provider directory or visit Medicare.gov/plan-compare for details.
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Medicare PPO (Preferred Provider Organization)
Medicare HMO-POS
(Health Maintenance Organisation with point of Service)
What is it?
An HMO-POS is a type of HMO Medicare Advantage plan that lets you use some providers outside the plan’s network for certain services. You’ll usually pay more when you go out-of-network, but you still get the same coordinated care structure as a regular HMO.
Key Features of HMO-POS Plans
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Network Rules – You generally must use in-network doctors, hospitals, and providers, except for emergencies, urgent care, or dialysis.
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Out-of-Network Option – For some or all covered services, you may get care outside the network, but you’ll pay a higher copayment or coinsurance.
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Primary Care Doctor – In most HMO-POS plans, you still need to choose a primary care physician (PCP).
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Referrals – Referrals are usually required to see specialists, though some preventive services don’t need one.
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Prescription Drugs – Most HMO-POS plans include Part D drug coverage. If you want drug coverage, you must join an HMO-POS that offers it
Important to Know
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Out-of-network coverage is limited and costs more than in-network care.
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Plans may require prior approval (authorization) for some services.
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If you get non-emergency care outside the network without authorization, you may have to pay the full cost.
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Always check your plan’s rules and network before getting care.
MCO (Managed Care Organization)
What is it?
“MCO” is a broad term for health plans that contract with Medicare to deliver your Part A (hospital) and Part B (medical) benefits. Most Medicare Advantage plans — like HMOs, PPOs, SNPs, and HMO-POS — are types of Managed Care Organizations. These plans work with networks of doctors, hospitals, and other providers to coordinate your care and help manage costs.
Key Features of MCOs
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Umbrella Term – HMO, PPO, HMO-POS, and SNP plans are all types of Medicare Advantage Managed Care Organizations.
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Network-Based Care – MCOs use provider networks. Some require you to stay in-network (HMO), while others allow out-of-network care at higher costs (PPO, HMO-POS).
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Coordinated Care – MCOs often use a primary care physician to help coordinate services and referrals.
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Prescription Drug Coverage – Most Medicare MCOs include Part D drug coverage, but you must enroll in a plan that offers it.
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Extra Benefits – Many MCOs provide additional benefits beyond Original Medicare, such as dental, vision, hearing, fitness, or transportation services.
Important to Know
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The rules and costs depend on which type of MCO you choose (HMO vs. PPO vs. SNP, etc.).
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Out-of-network rules vary — some plans cover it (at higher cost), others don’t.
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Plans may require prior approval (authorization) for certain services.
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Each MCO sets its own out-of-pocket maximum for covered services.
PFFS (Private Fee-for-Service)
What is it?
A PFFS plan is a type of Medicare Advantage plan where the plan decides how much it will pay doctors, hospitals, and other providers — and how much you must pay when you get care. You can generally see any Medicare-approved provider, as long as they agree to the plan’s terms and payment rules.
Key Features of PFFS Plans
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Provider Choice – You can usually see any Medicare-approved doctor or hospital, but the provider must agree to accept the plan’s payment terms for each visit.
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No Network in Some Plans – Some PFFS plans have a network of providers who agree to treat members; others don’t. If there’s no network, you can see any Medicare-approved provider who accepts the plan’s terms.
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No PCP or Referrals – You don’t have to choose a primary care physician, and you don’t need referrals to see specialists.
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Prescription Drugs – Some PFFS plans include Part D drug coverage. If the plan doesn’t, you can join a separate stand-alone drug plan.
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Nationwide Access – In many cases, you can use providers across the U.S., as long as they accept the plan’s rules.
Important to Know
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Providers can choose on a case-by-case basis whether to treat you under the PFFS plan.
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If a provider doesn’t accept the plan’s terms, you may need to find another provider.
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Costs (copays, coinsurance) may be higher than in-network arrangements offered by HMOs or PPOs.
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Always check before each visit to make sure the provider will accept your PFFS coverage.
ACO (Accountable Care Organization)
What is it?
An ACO is a group of doctors, hospitals, and other health care providers who voluntarily come together to coordinate care for people with Original Medicare. The goal is to improve quality of care, avoid unnecessary services, and help reduce costs. If your providers are in an ACO, you still have all the rights and coverage of Original Medicare.
Key Features of ACOs
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Works with Original Medicare – You keep all your Original Medicare benefits (Parts A & B). An ACO isn’t a Medicare Advantage plan.
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Coordinated Care – Your providers share information and work as a team to better coordinate your care.
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No Network Restrictions – You can see any doctor or hospital that accepts Medicare, even if they’re not part of the ACO.
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Focus on Quality – ACOs aim to prevent duplicative services and medical errors by sharing your health information securely among providers.
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Cost Savings – If the ACO provides high-quality care while using Medicare dollars more efficiently, it may share in the savings
Important to Know
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You don’t enroll in an ACO — your doctor or hospital system participates, and you’ll be notified if you’re aligned with an ACO.
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Being in an ACO doesn’t change your Medicare coverage or benefits.
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You still choose your own providers, as long as they accept Medicare.
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ACOs are about care coordination, not replacing or limiting your coverage.
What is it?
Value-Based Care is a health care approach where doctors, hospitals, and other providers are paid based on the quality of care they give you, not just the number of services provided. Many Medicare providers participate in VBC models to improve outcomes, coordinate care, and help manage costs.
Key Features of VBC
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Quality Over Quantity – Providers are rewarded for improving your health outcomes rather than billing for each service.
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Coordinated Care – Encourages teamwork among doctors, specialists, and hospitals to better manage your care.
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Focus on Prevention – Emphasizes preventive services and managing chronic conditions to keep you healthier.
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Cost Control – Aims to reduce unnecessary services, hospital stays, and medical errors.
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Used Across Models – VBC is part of programs like Accountable Care Organizations (ACOs) and other Medicare innovation models.
Important to Know
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VBC isn’t something you enroll in directly — it’s a framework your providers may participate in.
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You keep all your Original Medicare or Medicare Advantage benefits — VBC doesn’t replace coverage.
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Experiences may vary depending on how your providers participate in value-based programs.
VBC (Value - Based Care)
IPA (Independent Practice Association)
What is it?
An IPA is a group of independent doctors and other health care providers who join together to contract with Medicare Advantage plans (often HMOs). By banding together, these independent practices can offer a broader network of providers while still keeping their independence.
Key Features of IPAs
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Provider Network – An IPA is made up of independent doctors, specialists, and clinics that agree to work under one association.
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Used by HMOs & Other Plans – Many HMO Medicare Advantage plans contract with IPAs to deliver care to their members.
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Coordinated Services – Although providers remain independent, they work together through the IPA to coordinate patient care.
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Access to Specialists – IPAs often give you access to a wide range of specialists within the contracted network.
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Efficiency & Negotiation – By working as a group, IPAs can negotiate with plans and streamline administrative processes.
Important to Know
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An IPA itself is not a plan type — it’s part of the provider network structure used by some Medicare Advantage plans.
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Your costs and coverage depend on the Medicare Advantage plan you choose, not on whether your providers are in an IPA.
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Always check that your preferred doctors and specialists are in your plan’s network before enrolling.