Dear Savvy Senior,

I’ve been reading a lot about the new Medicare legislation and the Part D prescription drug benefit coming in 2006, but I’m enrolled in an HMO through Medicare+Choice. I did it three years ago because it was a little less expensive and because it offered more benefits, but I’ve heard little about the legislative changes to Part C. Can you get me caught up on any new adjustments to the Medicare+Choice plan?

Uninformed Eddy

Dear Uninformed,

What has been known as Medicare+Choice (Medicare’s managed care program) since 1997, has gotten a makeover and a new name. It’s now called Medicare Advantage. Here’s how it breaks down. Medicare currently provides health benefits to 41.7 million elderly and disabled Americans, most of whom (88 percent) receive their benefits through the original fee-for-service program (Part A and Part B), while only 11 percent are covered by private health care plans, now known as Medicare Advantage.

Losing Ground

The number of seniors participating in managed care programs has been on a steep decline. There are 145 MA plans this year, compared to 346 in 1998. And, the number of seniors in the plan has fallen from 6.3 million in 2000 to 4.6 million. The reason is health care and prescription drug costs have exploded, raising the average out-of-pocket expenses for Advantage beneficiaries from $429 five years ago to $1,260 last year.

Medicare Makeover

As part the 2003 Medicare legislation, Congress not only added prescription drug benefits for the traditional program, but stepped up the amount of money it pays MA plans. This year and next, the total amount of the increase will be $1.3 billion, which should result in lower costs and improved benefits. Depending on the MA plan you’re in, some of the immediate advantages can include:

• Lower monthly premiums: The average monthly premium for MA plans is expected to decrease $11 per month.

• Expanded benefits: MA plans can provide additional services not covered by Medicare such as routine physicals, drug benefits and vision and hearing exams. And, beginning in 2006, all companies offering MA plans (except private fee-for-service plans and medical saving accounts) must offer at least one plan with drug coverage.

• Expanding markets: MA plan choices will be expanded to include regional PPOs to give those in rural areas and those areas of the country not currently included more choices.

• Cost sharing: Some MA plans will reduce the cost of co-pays and deductibles.

• Additional choices: Some plans will offer more choices of doctors and hospitals.

Disadvantages

While there are improvements to the Medicare Advantage plans, there are still some pitfalls to be aware of, including:

• MA plans are managed care plans like HMOs, PPOs and PSOs, which means that you’ll still have to choose a doctor in the plan’s network or pay more to see one who is not in it.

• MA plans will be able to change their benefits and costs each year, and to decide whether or not to continue in a certain region, which leaves you vulnerable to their plan.

• Beginning in 2006, beneficiaries will be able to choose only once a year, between Nov. 15 and May 15, whether to stay in a MA plan, switch to another or return to traditional Medicare. In 2007, that time period will shorten to six weeks, between Nov. 15 to Dec. 31.

Savvy Note: Access to MA options will vary greatly depending on where you live and what types of plans are available in your community, however the original fee-for-service Medicare will continue to be a choice in all areas.

Savvy Resource

• State Health Insurance Counseling Program (SHIP): Offers free counseling to Medicare beneficiaries. They can help you understand and choose your best Medicare option. To locate your local SHIP call Medicare at 1-800-633-4227 or visit www. medicare.gov/Contacts/Related/Ships.asp

‘Send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070, or visit www. savvysenior .org. Jim Miller is a regular contributor to the ABC Today Show and author of "The Savvy Senior" book.