Fee-for-service retiree plans: plans that pay for care from any doctor or hospital and generally fill gaps in Original Medicare so you don’t need to buy other supplemental insurance. These retiree plans also may pay for some of the costs that Medicare does not pay for, such as the 20% coinsurance for doctors’ services.
Managed care retiree plans (HMO or PPO): plans that generally pay for care only from network doctors and hospitals – likely will only fill gaps in Original Medicare if you get care from plan doctors and hospitals and follow the plan’s rules. If you use a non-plan doctor or hospital, Medicare will cover 80% of its approved charges, and the plan may or may not pay for any of the rest of the cost of these services.
Employer-sponsored Medicare Advantage Plans, such as Medicare HMOs and PFFS plans, are plans for retirees who are eligible for Medicare. You can get both your Medicare benefits and your retiree health benefits by signing up for a Medicare Advantage Plan that has a contract with your former employer. Some employers require that you join a Medicare Advantage Plan to continue getting retiree health benefits. You can always choose not to take your employer’s coverage. However, keep in mind that you may not be able to get that retiree coverage if you want it at a later date.
All retiree plans vary so call the Human Resources Department of the company through which you have retiree coverage to find out exactly what your retiree insurance covers and how it coordinates with Medicare.