Your Medicare Advantage PPO Plan Can Stick-It-To-You

Medicare Advantage PPO (preferred provider organization) plans give members the flexibility to choose physicians, so they have coverage wherever they go within the United States or its territories. Even though non-contracted physicians don’t have to see every member (except in emergencies) and out-of-network services can cost more, PPO plans are a popular option, making up over 40% of plans.

As with just about every Medicare Advantage plan, PPO plans can require prior authorization, a process through which the physician or other healthcare provider must obtain approval from the plan in advance of any recommended procedure.

A big surprise

You don’t need prior authorization when you receive services from an out-of-network provider. Given that 99% of Medicare Advantage members are in plans that require authorization, this could be an amazing benefit.

But is it really? Remember the old adage. If something seems to be too good to be true, it probably is.

I researched the Evidence of Coverage documents from four of the biggest Medicare Advantage companies. I found this paragraph almost word-for-word in all of them.

You don’t need to get a referral or prior authorization when you get care from out-of-network providers. However, before getting services from out-of-network providers, you may want to ask for a pre-visit coverage decision to confirm that the services you are getting are covered and are medically necessary. This is important because: without a pre-visit coverage decision, if we later determine that the services are not covered or were not medically necessary, we may deny coverage, and you will be responsible for the entire cost.

PPO plan members need to understand the significance of those 85 words, or they could end up with some very big medical bills. Here are the important points.

There is no prior authorization requirement for out-of-network services. Given that physicians and their staff spend on average 14 hours each week completing PAs, they’ll be relieved not to do another.
Even though there is no requirement, the plan says you may want to ask for a pre-visit coverage decision.
Without that decision, the plan can later determine that the services were not covered or medically necessary.
In that case, the plan will deny the care and you will get the bill.

So, it may be best for you to change a few words in one sentence in that paragraph.

However, before getting services from out-of-network providers, you should ask for a pre-visit coverage decision to confirm that the services you are getting are covered and are medically necessary.

That may not be the easiest thing to do. The Evidence of Coverage does not provide any details about this decision or how to go about asking for one. The results of an internet search of “pre-visit coverage decision” focused on precoverage determinations for healthcare providers.

Tips to avoid retroactive denials

Whenever possible, get necessary medical care from an in-network provider. Prior authorization is generally the provider’s responsibility.

Examine your plan’s Evidence of Coverage for information about prior authorization for out-of-network services.

Check the members’ resources on your plan’s website for any information regarding authorization of out-of-network care. (I found only information about providers submitting authorization requests and authorization forms for personal representatives and the like.)

Ask a plan representative about a pre-visit coverage decision if you’re about to receive services from an out-of-network provider. Find out:

what information you need
your physician or provider’s role in this process
how to submit it
how the plan will communicate that the services are covered and medically necessary
the time frame (how soon before the services are provided and how long it will take to make the coverage decision), and
your options, including filing an appeal, if the plan determines it won’t cover the care.

Many Medicare beneficiaries love their PPO plans. But remember, there are two ways the plan can stick-it-to-you if you’re seeing out-of-network providers.