What Is Medicare Advantage, and What Should You Know Before Choosing a Plan?
How Is Medicare Advantage Different From Original Medicare?
Shanti
10/8/20263 min read
What Is Medicare Advantage, and What Should You Know Before Choosing a Plan?
If you have Medicare or will soon become eligible, you have probably heard of Medicare Advantage. Also known as Medicare Part C, it is another way to receive your Medicare benefits. Medicare approved private insurance companies offer these plans and must follow Medicare rules.
A Medicare Advantage plan can provide Medicare hospital and medical coverage through one plan. Most plans also include prescription drug coverage under Part D. However, costs, covered providers, and benefits vary from plan to plan.
How Is Medicare Advantage Different From Original Medicare?
Original Medicare includes Part A for hospital services and Part B for medical services. To get prescription drug coverage, you usually need to enroll separately in a Part D plan. In most cases, you can see any doctor or visit any hospital in the United States that accepts Medicare.
With Medicare Advantage, you receive Part A and Part B services through a private insurance plan. Most of these plans also provide Part D drug coverage. For nonemergency care, you may need to use doctors in the plan’s network or get a referral to see a specialist.
Both options have advantages and limitations. The right choice depends on your doctors, medications, costs, and health needs.
How Much Does Medicare Advantage Cost?
If you enroll in Medicare Advantage, you still have to pay your Part B premium. Some plans charge an additional monthly premium, while others may have no plan premium. However, a “zero premium” plan does not mean that all services are free.
Depending on the plan, you may have costs such as:
• A deductible
• A fixed amount for a service, called a copayment
• A percentage of the cost of a service, called coinsurance
• Different costs for services inside or outside the plan’s network
Medicare Advantage plans have a yearly limit on what you pay for covered Part A and Part B services. After you reach this limit, you pay nothing for covered Part A and Part B services for the rest of the year. The limit and costs vary by plan. Premiums, services the plan does not cover, and prescription drug costs may be handled separately.
Check the Provider Network and Prior Authorization Rules
With some plans, especially HMO plans, you generally need to use doctors and facilities in the plan’s network for nonemergency care. PPO plans may let you see providers outside the network, but you will usually pay more.
A plan may also require prior authorization before it covers certain services, medications, or medical equipment. Before choosing a plan, check that your primary care doctor, specialists, hospitals, and pharmacies are in the network. Also make sure your prescription medications are included on the plan’s drug list.
Extra Benefits Are Not the Same in Every Plan
Many Medicare Advantage plans offer benefits beyond standard Medicare coverage, such as dental, vision, hearing, or fitness services. However, seeing a benefit mentioned in an advertisement does not mean that every related service is free or has no restrictions.
Review the plan’s official documents to understand the amount of coverage, limitations, provider network, and any costs you may have to pay for each benefit.
Types of Medicare Advantage Plans
Medicare Advantage plans come in several types:
• HMO: You generally need to use the plan’s network. You may also need a referral to see a specialist.
• PPO: You may be able to see providers outside the network, usually at a higher cost.
• PFFS: The plan sets its own payment rules. Make sure a provider agrees to accept the plan’s terms before receiving care.
• SNP: These plans are designed for eligible groups, such as people with certain chronic conditions or people who qualify for both Medicare and Medicaid.
• MSA: This plan combines a high deductible plan with a medical savings account. Part D drug coverage usually needs to be purchased separately.
The rules vary by plan type, and not every type of plan is available in every area.
What Should You Compare Before Enrolling?
Before choosing or renewing a plan, ask yourself:
1. Are my doctors, specialists, hospitals, and pharmacies in the plan’s network?
2. Are my prescription medications covered, and how much will they cost?
3. What will I pay for the monthly premium, deductible, copayments, and coinsurance?
4. What is the yearly limit on what I pay for Part A and Part B services?
5. Does the plan require prior authorization for services I may need?
6. What services do the extra benefits cover, and what restrictions apply?
7. Is the plan available where I live?
Plan costs and coverage can change each year. Review the Annual Notice of Change and the Evidence of Coverage to learn about changes to the provider network, costs, medications, and benefits.
When Can You Change Your Plan?
Medicare’s Annual Enrollment Period runs from October 15 through December 7 each year. During this period, you can compare Medicare plans and change your plan for the following year if needed. Since plan costs and provider networks may change each year, reviewing your plan before renewing can help you make an informed choice.
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