Margin for Mission

Medicare Advantage and You

By Robert Hall, PPS Senior Consultant

There are a number of payers out there, whether in the private sector or the government.

One public/private partnership is steadily growing. Medicare Advantage (MAd) (which used to be known as Medicare Part C and then Medicare+Choice) might look, for all intents and purposes, like a private plan, and because of its private insurance flexibility, it may also provide more benefits for beneficiaries who choose to enroll in it. Even though cuts to rates for MAd went a long way in offsetting the cost of the coverage expansion in the Affordable Care Act, MAd enrollment has nearly doubled over the last decade. In fact, more than one-third of all Medicare beneficiaries are enrolled in MAd, with greater than 20 million beneficiaries enrolled in 2019 (compared to 5.2 million in 2004). On a state level, however, there is wide variation in MAd enrollment, ranging from only 3% of all Medicare beneficiaries in Wyoming to 56% in Minnesota. See “Discover More about MAd Where You Are” to explore MAd in your area.

MAd plans must offer at least the same level of coverage as Medicare Part A (hospital insurance) and Part B (outpatient or ambulatory care), but how they interact with private physical therapy practices can be complicated. Fortunately, PPS has produced a new resource that can help you determine if working with MAd is advantageous.

To determine whether and how your practice may wish to interact with MAd, answer three simple questions:

1. Am I enrolled as a Medicare “participating provider,” a “non-participating provider” or not enrolled at all?
2. Am I enrolled in the MAd plan that I want to bill?
3. Does the MAd plan have out-of-network benefits?

The PPS Medicare Advantage Q&A resource examines six scenarios depending on the answers to these and a few other questions. Before walking through the scenarios, it should be noted that if you are enrolled in the MAd plan, you should follow that plan’s rules for submitting a claim. Even if you aren’t enrolled in the plan, though, the plan’s rules should be followed regarding who submits the claim – you or the patient – if a claim may be submitted at all.

These scenarios can get complicated when it comes to what payment rate applies to a particular service, so strap in.

Scenario #1

If a MAd plan has out-of-network benefits, but you are not enrolled in it (but you are a Medicare participating provider), the answer to whether you can bill depends on the plan’s rules. In this scenario, the provider must accept, as payment in full, the cost sharing and what the plan pays. No “balance billing” is allowed.

Scenario #2

What if the MAd plan does not have an out-of-network benefit (often the case with traditional HMOs), you are enrolled as a Medicare “non-participating provider” and you are not enrolled in the MAd plan itself? The plan is still required to pay for the services, but payment rates for the services involve something called the “limiting charge,” which is a synonym for the maximum amount Medicare rules require a MAd plan to pay for the service. Enrollees can still be required to pay the normal copay (a set dollar amount) or a calculated coinsurance (a percentage of the overall charge) amount. To calculate the coinsurance amount in this scenario, multiply the coinsurance percentage by the limiting charge. This means that if a plan has a 20% coinsurance (.20) and a 115% (1.15) limiting charge, the coinsurance to charge is 23% (.2 x 1.15).

Scenario #3

If the MAd plan does provide out-of-network benefits, but you are enrolled in neither the Medicare nor the MAd plan, you as the provider of services must accept the amount the plan pays, in addition to patient cost-sharing, as payment in full. In this scenario, again, no balance billing is allowed.

Scenario #4

If the MAd plan does not have out-of-network benefits, if you are enrolled in Medicare as a participating provider, and if you are not enrolled in the particular MAd plan, the MAd patient may be required to pay the entire charge. However, if the service in question is not available under the MAd plan, the plan may be required to cover the service.

Scenario #5

If you are enrolled in Medicare as a “non-participating provider,” are not enrolled in the MAd plan, but the MAd plan does not have out-of-network benefits, the MAd patient is required to compensate in full for the therapy services provided if the services were neither emergency nor urgently needed. Adding a further wrinkle like in Scenario #4, if the services were not available under the plan, the plan may be obligated to pay for the service.

Scenario #6

Finally, if you are enrolled in neither Medicare nor the MAd plan (and the MAd plan has no out of network benefit), the MAd patient must compensate for the full cost of services, assuming the services were neither emergency nor urgent. As in Scenarios #4 and #5 above, if the services were not available under the plan, the plan may be obligated to pay for the service.

In any scenario, but especially in #4, #5 and #6, it should be noted that MAd enrollees may always challenge payment denials and written advance requests for coverage determinations may be filed by enrollees or providers.

Simple, right? Even with this complexity, as MAd enrollment continues to grow and become more prevalent in many communities, it behooves you to determine how you are going to be paid for the services you provide to MAd beneficiaries. That way, your margin can continue to support your mission.

Bob Hall is a Senior Consultant for PPS working to advocate with private payers. Prior to his work with PPS, he was the Director of Government Relations for the American Academy of Family Physicians, the access to care lobbyist for the American Academy of Pediatrics, the Director of Government Relations for the National Coalition for Cancer Survivorship, Counsel to US Senator Mark Dayton, Attorney Advisor to the US Securities and Exchange Commission, and Chief Clerk to the Texas House of Representatives Insurance Committee. He holds a Masters in Public Affairs from the LBJ School of Public Affairs, a Juris Doctor from the University of Texas School of Law and a BA from Haverford College.