You'll be in a better position to weigh the costs and benefits of Medicare managed care plans if you understand how insurance companies and doctors make money through them.

There are advantages and disadvantages to Medicare managed care plans. If you are trying to decide whether managed care is for you, it helps to understand how insurance companies and doctors turn a profit through these plans.

One way to understand the strengths and weaknesses of Medicare managed care is to view it as a betting system, with insurance companies acting as bookmakers, and plan members and doctors as gamblers.

The doctors and providers are also gambling. They are betting that the money they receive from the insurance company, plus copayments from patients, will cover the cost of care they provide under that plan and leave them, too, with a profit.

Finally, plan members -- the patients -- are betting that low premiums and copayments will add up to lower cost healthcare than with a medigap policy (private supplemental insurance). They are also betting that the extra hassles of managed care -- such as having to go through a primary care physician to get all other care -- are worth the savings. And they are betting that the lower cost of managed care does not mean they will get a lower quality of care.