Medicare Advantage vs Traditional Medicare: What Changes for Billing

Who decides coverage and payment once a patient is in a plan

In traditional Medicare a Medicare Administrative Contractor makes the first decision on a claim, working from national and local coverage determinations, the Medicare benefit conditions and the fee schedule. In Medicare Advantage the plan makes that decision itself. An organization determination covers whether the item or service is covered, how much is covered, and what the enrollee owes (42 CFR 422.566).

The plan cannot invent coverage. It must apply national coverage determinations, the general coverage and benefit conditions in traditional Medicare law, and the local coverage decisions written for its service area. Where Medicare criteria are not fully established it may apply its own internal criteria, published with the evidence and rationale behind them (42 CFR 422.101). Its necessity decisions must account for the enrollee’s history, the treating physician’s recommendation and the clinical notes.

Prior authorization is the biggest Medicare Advantage billing change

Original Medicare does not route most Part B services through an authorization. A coordinated care plan may, and the services it covers that way are listed by the plan. Since January 1, 2026 a denial of an authorization request must state the specific reason, and each plan must publish its authorization metrics, including approval, denial and overturn rates, by March 31 for the prior year (42 CFR 422.122).

The clocks are shorter than anything in fee-for-service and they start when the request arrives, not when it is finished. A standard decision on a service that needs authorization is due in 7 calendar days from January 1, 2026. Other standard requests get 14 days. An expedited request gets 72 hours, or 24 hours for a Part B drug. An extension of up to 14 days is allowed only for reasons the regulation names.

Authorization may be used only to confirm the presence of diagnoses or other medical criteria, or to establish that a service is medically necessary. An approval stays valid as long as it is medically reasonable and necessary, and a patient who switches plans mid-treatment gets a 90-day transition period in which the new plan may not require authorization for the active course of treatment (CMS-4201-F fact sheet).

• Pull each plan’s published authorization list in January and again when a plan revises it
• Log the exact time an authorization request was sent, because the plan’s clock starts then
• Flag every patient whose plan changed mid-treatment for the 90-day transition period

Where the claim goes, and who pays it

A claim for a patient in a plan is not a Medicare claim. It goes to the plan under the plan’s payer identifier, its clearinghouse enrollment and its own filing rules. CMS states that MACs process Original Medicare claims while Medicare Advantage plans process all claims through their own claims and payment procedures and send a remittance advice of their own (MLN8659122). The patient gets an explanation of benefits, not a Medicare Summary Notice.

Payment timing is regulated. A plan must pay 95 percent of clean claims within 30 days when they come from or on behalf of an enrollee of a private fee-for-service plan, or when they are for services not furnished under a written agreement, and interest runs on late clean claims. Any other claim from a provider with no contract must be paid or denied within 60 calendar days.

A practice with no contract must accept, as payment in full, the amount it could collect if the patient were enrolled in original Medicare (42 CFR 422.214). The fee schedule is still the reference point there, while a contracted practice is paid whatever its agreement says. A contract rate below Medicare is a contract question, not a billing error (Medicare Physician Fee Schedule 2026).

The plan’s own filing and appeal rules, and the ladder you filed before

A denial is appealed through the plan. The first level is a reconsideration the plan performs on its own determination, filed within 60 calendar days after receipt of the written notice, with receipt presumed 5 calendar days after the notice date unless there is evidence to the contrary (42 CFR 422.582). The plan then has 30 calendar days for a service reconsideration or 60 for a payment.

If the plan affirms any part of the denial it must send the case file to the CMS-contracted independent review entity inside the same window. That second level is automatic, and the practice does not file it. From May 1, 2026 the Part C independent review entity is C2C Innovative Solutions (CMS managed care appeals).

Who can appeal is narrower than in fee-for-service. The parties are the enrollee, an assignee who furnished a service and formally waived payment from the enrollee, a deceased enrollee’s estate, and any provider the plan finds has an appealable interest. A contracted practice whose payment request is settled with no liability left on the enrollee is outside subpart M, and its remedy is the contract (Medicare Advantage denials).

Cost sharing, and who is responsible for collecting it

The 20 percent coinsurance belongs to fee-for-service. In a plan the enrollee pays the plan’s copayment or coinsurance, often a flat dollar amount for a routine visit. Plan cost sharing for basic benefits must be actuarially equivalent to Medicare fee-for-service cost sharing, may not exceed 50 percent coinsurance where the regulation sets no lower limit, and must cap in-network cost sharing for Part A and Part B services at or below the annual limit CMS calculates from fee-for-service projections (42 CFR 422.100).

Emergency care carries its own protection. The plan pays for emergency and urgently needed services whether or not the patient is in network and whether or not authorization exists, and the enrollee’s share is limited to the lower of the plan’s in-network cost sharing or a per-visit maximum.

What the practice can and cannot do when the plan denies a covered service

Start with the reason, because a plan denial must now carry one. Read the notice, and ask the plan in writing for the internal criterion it applied if the notice does not name it. If the plan used a criterion it never published, or cited a Medicare rule that governs some other service, that is the appeal.

Then work the levels in order: a reconsideration with the plan inside 60 days, an expedited review where the standard clock could seriously jeopardize the patient’s health, and a peer-to-peer review beside the reconsideration rather than instead of it. When the plan affirms, the file reaches the independent review entity without the practice filing anything.

• You can request an organization determination, a plan reconsideration and an expedited review, and file for the enrollee with the enrollee’s agreement
• You can ask for the criterion the plan applied and test it against the Medicare criteria the plan must follow
• You cannot route the claim to the MAC, to the quality improvement contractor or to any fee-for-service appeal level

Do the federal surprise-billing protections cover a Medicare Advantage plan?

No. CMS states directly that the No Surprises Act protects people with group health plan coverage, group or individual health insurance, Federal Employees Health Benefits coverage, Marketplace coverage or a plan bought from an insurer, and that its protections do not apply to consumers covered through Medicare, including Medicare Advantage, Medicaid, the Children’s Health Insurance Program, the Indian Health Service, the Department of Veterans Affairs or TRICARE (The No Surprises Act at a Glance).

So there is no federal balance-billing protection for a plan enrollee, no notice-and-consent paperwork, and no federal independent dispute resolution route for a plan claim. CMS notes that these programs generally have their own protections against balance billing, and for Medicare Advantage those sit in part 422 and in state law.

What exists instead is narrower but real. Emergency and urgently needed services must be covered regardless of network, cannot be made subject to prior authorization, and carry a capped enrollee cost share. A practice with no contract must accept the original Medicare amount as payment in full, which caps what it can collect for the service from anyone (42 CFR 422.113).

That shapes what the front desk can say. A patient can be told that emergency care cannot require prior authorization and that their share of it is capped, and that a plan decision can be reviewed first by the plan and then by an independent reviewer. A practice should not promise that the federal surprise-billing law governs their bill, and it should check the state’s balance-billing rules before deciding what can be billed after a denial.

A plan population therefore needs different front-end work from a fee-for-service one: an eligibility check that confirms the plan and the payer identifier, an authorization tracker, and an appeal calendar built on the plan’s 60-day window rather than Medicare’s (insurance verification checklist). We run that as prior authorization services and eligibility verification on top of full-cycle medical billing.

Questions practices ask us about this