A Publication of WTVP

What’s the answer to health care for the aging population? The Centers for Medicare and Medicaid Services (CMS) are trying to find answers for beneficiaries. A recent project approved as a Medicare+Choice (M+C) demonstration is Preferred Provider Organizations (PPOs) for Medicare beneficiaries. Very popular among the current working force, PPOs provide flexibility in a managed care environment. This may be the ideal match for an aging population concerned with both finances and health care.

Medicare+Choice PPOs are offered to Medicare beneficiaries through 32 new health plans in 23 states. The intent of this demonstration is to test PPOs to determine if high quality, affordable health care—with choice—can be offered to Medicare beneficiaries in a managed care model. Most of the M+C PPO plans offer wellness benefits. All of the PPOs offer some type of prescription drug benefit, disease management programs, and the choice option all consumers of health care seem to desire.

Drug benefits offered through M+C PPOs are often limited and may include formularies and monthly, quarterly, and/or annual limits. The drug benefits are intended to provide assistance to Medicare beneficiaries with their prescriptions and may not cover all prescriptions needed. Since Medicare currently doesn’t cover prescription drugs, the prescription benefits offered to beneficiaries through managed care plans are often better than any other benefit available to them.

Disease management programs include focused services for those beneficiaries with chronic diseases such as diabetes and congestive heart failure. Programs for chronic diseases help beneficiaries with these diseases improve their overall health through focused care and attention to the symptoms, side effects, and warning signs of the specific disease. Often a patient is in regular contact with a nurse case manager who specializes in the specific disease and is available as a resource to the member, the physician, and the health plan. The results of beneficiaries who participate in these programs are very positive, with the overall health improving and the overall cost of their health care decreasing.

Finally, M+C PPOs offer choice to beneficiaries through expanded networks and out-of-network benefits. Traditional managed care models use gatekeepers, referrals, and restricted lists of health care providers to coordinate care and contain costs. PPOs may still use primary care physicians for overall care coordination, but with the PPO, the beneficiary is in the driver’s seat. They don’t need referrals (for most PPOs) and they aren’t restricted to the list of network providers. Beneficiaries are responsible for more of the cost when they go to out-of-network providers, but they still have a choice of whom to see.

While M+C PPOs may not be the final destination of the Medicare program, they are a good start in the right direction. They’re a good mix of quality health care, cost containment, and consumer choice. M+C PPO Demonstrations are approved for a three-year demonstration period. Within that period of time, health plans and consumers should have preliminary results as to the effectiveness and popularity of these plans. At the very least, Medicare beneficiaries now have more options to choose from in how they receive their health care: original Medicare (a fee-for-service plan), M+C HMOs, other M+C options (available in limited areas), and now M+C PPOs. IBI