Medicare Advantage Plans

While a majority of seniors (age 65 and older) get their health insurance through Original Medicare, a substantial portion get their insurance coverage through a Medicare Advantage Plan (Part C). Private insurance companies that offer Medicare Advantage Plans are contracted with the Federal government to administer Medicare benefits.

The three most common types of Medicare Advantage Plans are:

• Private Fee-for-Service
• Preferred Provider Organizations (PPO)
• Health Maintenance Organizations (HMO)

Also available under Medicare Part C Medicare Advantage Plans are:

• Special Needs Plans (SNPs) – These plans are designed for individuals who require specialized health needs coverage, or who are in special situations. Typical qualifying situations are chronic or disabling conditions, you live in a nursing facility, or are enrolled in both Medicare and Medicaid.
• Medical Savings Account (MSA) – Although less common than the HMO or PPO plans, the MSA plan typically saves money and provides more control. They are usually combined with a “high deductible” Medicare Advantage Plan.
• HMO Point-of-Service Plan (HMO POS) – This plan is similar to an HMO but differs by letting the enrollee get medical services in and out of the network if they are willing to pay higher out-of-pocket expenses.

Medicare Advantage Plan Coverage

Medicare Advantage Plans are regulated by the government, and all plans must provide the same coverage as Original Medicare. They may also provide additional coverage that Original Medicare does not offer. Part C Medicare Advantage Plans cover:

All the services that Original Medicare covers except for hospice care, Original Medicare will continue to provide this coverage.

Emergency and urgent care services.

Some plans offer additional coverage like vision, dental, and hearing benefits and memberships to health and wellness programs.

Many plans also provide prescription drug coverage, these plans are Medicare Advantage Prescription Drug Plans (MAPDs).

What are the Pros and Cons of a Medicare Advantage Plan?

Medicare Advantage Plans may not be the best solution for everyone, and the pros and cons may be different depending on your individual circumstances.

Advantages of Medicare Advantage Plans:

Depending on the state and county where you live, some Medicare Advantage Plans are offered at a $0.00 premium (your Medicare Part B premium is still paid to Medicare)

You may receive additional coverages that are not included in Medicare Part A or Part B, like vision, dental, hearing, and prescription drug coverage.

Medicare Advantage Plans contain a maximum out-of-pocket that limits how much you will spend on your healthcare costs each year. Once your out-of-pocket limit is reached, you will pay nothing for covered health care services for the remainder of the year. The out-of-pocket limits are established by the insurer, and can change from year to year.

Disadvantages of Medicare Advantage Plans:

Pricing and plan specifics of Medicare Advantage Plans depend on the state and county you reside, and your out-of-pocket costs for health care coverage could be higher than Original Medicare.

If you elect an HMO plan, the insurance company determines which doctors and hospitals you will be allowed to visit for health care. You may be required to change doctors and specialists if they are not a member of your plan’s HMO.

Private insurers that offer Medicare Advantage Plans can choose not to renew their contract with Medicare, therefore, leaving you to go elsewhere at renewal.

What’s the best way to Choose a Medicare Advantage Plan?