A Medicare Private Fee-For-Service (PFFS) plan is a type of Medicare Advantage plan that allows you to see any doctor or specialist who accepts the plan’s payment terms, without referrals or prior authorization. However, those plans are generally more expensive and less popular than HMOs or PPOs. Most Medicare Advantage shoppers choose HMO or PPO plans over PFFS due to their lower cost. Some PFFS plans may offer additional benefits such as dental or vision coverage.
How Does PFFS Work?
A PFFS plan uses a fee-for-service model where the insurance company pays a set amount for medical treatments. Policyholders may have to pay a copay or deductible. They may have a network of providers or allow out-of-network providers to decide whether or not to accept the plan’s specified rates. Those plans do not require referrals or prior approval for treatment. However, they are less common than HMOs or PPOs and makeup only 1% of Medicare Advantage plans with a similar enrollment rate. PFFS plans are not the same as Original Medicare or Medigap and have their own specific policy guidelines and medical provider networks.
However, choosing a PFFS plan requires checking the network of providers because non-emergency healthcare access is guaranteed only through in-network providers. PFFS plans offer access to any medical provider who agrees to the plan’s terms and payment rate, but policyholders have faced difficulty getting consistent care from out-of-network providers. Medicare Advantage HMO (High Maintenance Organization) offers cheaper in-network coverage, while Medicare Advantage PPO provides out-of-network coverage. Alternatively, Original Medicare and Medigap offer coverage for 99% of medical providers, providing greater flexibility in choosing healthcare providers.
What are the Pros and Cons of PPFS?
Pros of PFFS plans include not needing referrals or pre-approvals for specialized care, not requiring a primary care provider, and the option to add a prescription drug plan through Medicare Part D. However, the cons include that those plans are expensive, out-of-network providers may refuse treatment, and balance billing can be a potential risk.
PFFS plans have similarities to other Medicare plans. They bundle hospitalization and medical care, with some plans covering prescriptions, dental, and vision. Emergency care is guaranteed, and PFFS plans have deductibles, out-of-pocket maximums, and copayments. Only medically necessary treatment is covered, and elective procedures are excluded.
Do PFFS cover prescription drugs?
Yes, PFFS can include prescription drug coverage. You should review the plan’s drug formulary to make sure the medications you need are covered. However, if a plan doesn’t offer drug coverage you can purchase a separate Part D plan.
Do I need to purchase a separate Medigap policy with a PFFS?
Since a PFFS is a type of Medicare Advantage plan you cannot purchase any Medigap policy or Medicare supplemental insurance. Medigap policies only work with Original Medicare since their primary function is to fill in the coverage gaps that are left out by Parts A and B. When are you enrolled in Medicare Advantage plans they become your primary source of coverage instead of Original Medicare even though they are required by law to provide all basic benefits as Original Medicare does.
What are the costs of PFFS?
The costs of PFFS plans vary depending on the insurance company, the specific plan, and the location where you live. However, here are some common costs associated with PFFS plans:
- Monthly premiums: You will typically pay a monthly premium for your PFFS plan. The amount of your premium will depend on the plan you choose and the benefits it offers.
- Deductibles: may have an annual deductible that you must pay before the plan begins to pay for your healthcare services.
- Copayments and coinsurance: You may be responsible for paying a portion of the cost of each healthcare service you receive, either as a copayment or coinsurance.
- Out-of-pocket maximum: they may have an annual out-of-pocket maximum, which is the most you would have to pay for covered healthcare services in a given year. The set amount for MOOP is 8300$ in 2023, but most insurance companies have amounts lesser than this.
To determine what your actual costs will be is best to talk with licensed Medicare insurance agents because costs for these plans vary as already explained in the beginning. With the right research and comparison between plans, you will make a more informed decision about which plan best meets your need and budget.
Is PFFS the Best Option in Comparison to Other Medicare Advantage plans?
With a PFFS plan, you can visit any provider who accepts the plan’s payment amounts, whether they are in-network or not. Referrals are not required to see a specialist, nor is prior authorization needed for treatments.
With an HMO plan, you can only see in-network providers, and referrals are often necessary to see a specialist. Pre-approval from the insurer is usually required for treatments.
With a PPO plan, you can see any doctor you choose, but you will pay more if the doctor is out of network. Referrals are often required to see a specialist, and pre-approval from the insurer is usually necessary for treatments.
Are PFFS and Original Medicare the Same Thing?
No, PFFS (Private Fee-for-Service) and Original Medicare are not the same things. Although they both offer medical coverage, they are distinct types of coverage.
Original Medicare is a government-administered health insurance program that consists of two parts: Part A, which covers hospital insurance, and Part B, which covers medical insurance. Under Original Medicare, you can generally go to any doctor or hospital that accepts Medicare.
On the other hand, private insurance companies offer PFFS as a form of Medicare Advantage plan. PFFS plans may include medical coverage, prescription drug benefits, and other supplementary benefits, such as dental coverage. However, PFFS plans may have different rules, restrictions, and costs compared to Original Medicare and may require you to use specific healthcare providers within their network.
Which is Better PFFS or Original Medicare Coverage?
Original Medicare is a federal health insurance program that provides coverage for medically necessary services and supplies. It has two parts: Part A, which covers hospitalization, skilled nursing facility care, and some home health care; and Part B, which covers doctor services, outpatient care, and some preventive services.
A Private Fee-for-Service (PFFS) plan is a type of Medicare Advantage plan offered by private insurance companies. It is a type of Medicare Advantage plan that allows you to receive care from any doctor or hospital that accepts the plan’s payment terms and conditions. The PFFS plan determines how much it will pay doctors, hospitals, and other healthcare providers, and the providers decide whether or not they will accept the plan’s terms.
The main difference between Original Medicare and a PFFS plan is that Original Medicare is a fee-for-service program administered by the federal government, while a PFFS plan is a private insurance plan that operates under certain rules and regulations set by the federal government. With Original Medicare, you have the flexibility to choose any doctor or hospital that accepts Medicare, while with a PFFS plan, you must use providers who accept the plan’s payment terms and conditions.
Whether Original Medicare or a PFFS plan is better for you depends on your individual healthcare needs and preferences. Original Medicare provides greater flexibility in terms of providers and may be more suitable for people who travel frequently or have complex healthcare needs. On the other hand, a PFFS plan may offer additional benefits such as vision, hearing, and dental coverage, as well as prescription drug coverage, which may be more suitable for some individuals. It’s important to compare your options carefully and choose the plan that best meets your individual healthcare needs and budget.