How to Become a Medicare Advantage Organization

The Center for Medicare and Medicaid Services (CMS) offers private health insurance companies the opportunity to bring publicly funded customers into the world of private insurance. Your health maintenance organization (HMO) or preferred provider organization (PPO) plans can be extended to Medicare participants when you join the Mediare Advantage program. CMS' concept is that private administrators give Medicare participants opportunities for better customer service and streamlined insurance company assistance. Today, if you can work with CMS' systems and offer a good plan with good customer service, you have a chance at new revenue inflows from Medicare.

Instructions

• 1

  Apply to the insurance commissions of any states in which you intend to offer coverage for certification that your organization meets the requirements of an HMO or PPO insurer within their jurisdictions. Commissions usually make application information available on their websites and take questions by telephone. Depending on the state, you may need to submit a detailed prospectus of the specific plans you intend to offer as part of your Medicare Advantage offerings. You will need to include this certification in your application to Medicare.

• 2

  Reach a minimum health care plan subscriber base of 5,000 or 1,500 if you provide in a rural area. Patient Safety Organizations -- designated health care providers who work with the U.S. Department of Health and Human Services to deliver reliable health care -- need only 1,500 or 500 if in a rural area. Generate proof of your subscription base for your application.

• 3

  Purchase surety bonds in the amount of no less than $100,000 per plan subscriber on your books or per the requirement of the state or states in which you operate -- whichever is higher. You will need to maintain this level of bonding for as long as you participate as a Medicare Advantage provider.

• 4

  Purchase insurance plans to protect your business including general liability, fire, loss, theft and business interruption. CMS wants to see that you are protected against the unforeseen and capable of continuing your operations to serve the Medicare subscribers under your care.

• 5

  Adopt a policy or statement of ethics and standards that mirror or exceed the integrity guidelines CMS outlines for Medicare Advantage providers. These are included in Medicare Advantage application materials that can be downloaded from the CMS website. Important commitments include guarantees to patient care, customer service and fiduciary responsibility both to Medicare and subscribers.

• 6

  Provide the National Committee for Quality Assurance (NCQA) evidence that you can supply information and data in CMS format requirements, you can and will comply with ongoing responsibility requirements per NCQA regulations and you have adequate staffing to perform all the work and duties required to serve your Medicare Advantage subscribers. This occurs only after CMS approves your application and is a final screen applied to ensure quality of federal contractors.