Medicare-Medicaid (MC-MC) health payment is more complicated as states manage these programs and administer them uniquely under federal guidelines. Some states allow patients to enroll in managed care plans (HMOs or PPOs) or opt for a fee-for-service system. The state MC-MC office contracts with the HMO or PPO to provide patient services under their managed care plan and accept the MC-MC fee schedule for payment for the services their patients receive. These are called Medicare Advantage Plans. The fee-for-service system pays hospitals for services provided according to specific patient diagnosis groups (DRGs) and codes, with payment capped according to a specific schedule.
