Medicare Advantage plans have become increasingly popular in recent years, with over 26 million people enrolled in 2023. However, these private insurance plans also come with some significant disadvantages compared to original Medicare. This article will outline the major cons of Medicare Advantage you should understand before signing up.
A Medicare Advantage plan is an alternative to original Medicare provided by private insurance companies. Medicare Advantage plans, also known as Medicare Part C, bundle Medicare Part A and medicare Part B coverage and often include prescription drug coverage as well. Many seniors find Medicare Advantage appealing due to the extra benefits and lower out-of-pocket costs they can offer.
However, there are also some key downsides to be aware of when considering a Medicare Advantage plan. Understanding both the pros and cons will help you make the best Medicare health plan decision for your personal situation.
What are the Restrictions with Provider Choice and Referrals?
One key disadvantage of Medicare Advantage plans is that they have more restricted provider networks compared to original Medicare. Most Medicare Advantage plans require you to use in-network providers.
With original Medicare, you can see any doctor or hospital in the United States that accepts Medicare. Medicare Advantage plans have network limitations that may prevent you from seeing your preferred doctor or getting care at the hospital you want.
Medicare Advantage HMO and POS plans also require referrals from your primary care doctor before you can see specialists. With original Medicare, no referral is needed to see any specialist that accepts Medicare. The referral requirement can cause delays in getting care.
Make sure to check that your preferred doctors, specialists, hospitals, and other providers are in-network for any Medicare Advantage plan you consider choosing. Provider networks can change every year.
How do Out-of-Pocket Costs Compare to Original Medicare?
The out-of-pocket costs with Medicare Advantage plans can be higher than you may think. While Medicare Advantage plans have an annual limit on your out-of-pocket spending for covered medical services, this limit can be over $7,500 in 2023 depending on the plan.
With original Medicare coverage, you can add supplemental coverage through a Medigap plan which covers 100% of Medicare out-of-pocket costs for many seniors. This provides predictable costs for original Medicare beneficiaries. Out-of-pocket spending is usually lower with original Medicare plus Medigap compared to Medicare Advantage.
Medicare Advantage plans also charge copays and coinsurance for many services. With Medigap, many plans cover your Medicare deductibles, coinsurance, and copays so you pay $0 out-of-pocket for covered services. This means lower costs per doctor visit or hospital stay compared to Medicare Advantage for many members.
What are the Drawbacks of Medicare Advantage Prescription Drug Coverage?
While Medicare Advantage plans include Medicare Part D prescription drug plan, keep in mind that when you sign up for medicare coverage may not be as comprehensive as stand-alone Part D plans. Each Medicare Advantage plan has its own formulary that lists covered medications. Your prescription costs and preferred medications covered can vary significantly between Medicare Advantage plans.
With stand-alone Part D plans, you have many plan options to find the most favorable drug coverage for your medications and health conditions. Medicare Advantage plans offer more convenient coverage bundling, but less flexibility to customize your drug benefits.
The pharmacy network is also usually more limited with Medicare Advantage prescription coverage. Make sure to review each plan’s provider directory and formulary to understand its medication coverage before choosing a Medicare Advantage plan.
What Coverage Limitations Exist Outside Your Plan’s Network?
While Medicare Advantage plans cover emergency and urgent care nationwide, you may only be covered out-of-network for these limited situations. If you use out-of-network providers for other non-emergency services, your Medicare Advantage plan may not cover the care at all.
Original Medicare covers you at any healthcare provider nationwide that accepts Medicare. You have more flexibility to get care without coverage restrictions.
Medicare Advantage members also need to request prior authorization from their plan before getting certain services, such as MRI scans, procedures or surgeries. With original Medicare, no prior authorization is required.
Why is Original Medicare Better for Medigap Supplemental Coverage?
As mentioned earlier, original Medicare supplement coverage through Medigap plans. This can greatly reduce your out-of-pocket costs and provide cost-effective health insurance coverage.
However, Medigap plans do not work with Medicare Advantage plans. You cannot purchase a Medigap plan to cover cost-sharing with a Medicare Advantage plan.
This is a key downside because Medigap plans can cover 100% of Medicare deductibles, copays, and coinsurance in many cases. Medigap plans provide valuable protection against unexpected medical costs. Make sure you are comfortable with Medicare Advantage out-of-pocket spending limits and costs before signing up.
What are the Disadvantages When Traveling with Medicare Advantage?
Medicare Advantage members may only be covered for urgent and emergency care when traveling outside their plan’s service area. Routine care probably will not be covered out-of-network.
With original Medicare, you have coverage nationwide for any healthcare provider accepting Medicare patients. This provides more confidence and flexibility when traveling within the United States.
Medicare Advantage plans also do not provide coverage for healthcare services outside the United States. Original Medicare offers limited foreign travel emergency coverage that Medicare Advantage does not.
How Difficult Can it be to Switch Back to Original Medicare?
Many people enroll in Medicare Advantage plans not realizing how difficult it can be to leave the plan and switch back to original Medicare. Medicare Advantage has limits on when you can leave a plan each year.
You can only disenroll from a Medicare Advantage plan and return to original Medicare during the annual enrollment period from October 15 to December 7 each year for coverage starting January 1. There are also limited special circumstances for leaving a Medicare Advantage plan mid-year.
This means once you join a Medicare Advantage plan, you are generally locked into that plan for the entire year. Carefully consider both the advantages and disadvantages of Medicare Advantage before making this important Medicare decision.
What are the Enrollment Drawbacks and Risks with Medicare Advantage?
Medicare Advantage open enrollment runs from January 1 to March 31 each year. During this time, you can switch Medicare Advantage plans or join a Medicare Advantage plan if you have original Medicare. However, there are risks to be aware of during this period.
If you join a Medicare Advantage plan for the first time during open enrollment, you have until March 31 to leave the plan and switch back to original Medicare. After April 1, you cannot return to original Medicare until the next annual enrollment period.
This means you may get locked into a Medicare Advantage plan that ends up not being a good fit for your healthcare needs and preferences. Do your research carefully before choosing and enrolling in a Medicare Advantage plan.
How Do Benefits and Costs Change Each Year with Medicare Advantage Plans?
Medicare Advantage plans can change costs, coverage rules, and provider networks each year. Your plan may increase out-of-pocket costs, drop your doctor from the network, or reduce supplemental benefits from one year to the next.
With original Medicare, your coverage and protections remain consistent year after year. The only changes are to Medicare deductibles and coinsurance amounts which are usually minimal. Your provider choice also remains the same.
With Medicare Advantage plans, you must review plan details each year during open enrollment to make sure your coverage continues meeting your needs. Significant changes can happen without much advance warning.
What are the Top Complaints About Medicare Advantage?
Many Medicare Advantage members complain about denials of prior authorization for services, issues using out-of-network coverage, and difficulties changing providers due to narrow plan networks. Complaints of delays getting care and higher costs than expected are also common.
Consumer advocates also point out the high administrative costs and profits of Medicare Advantage plans compared to the much lower overhead costs with original Medicare. As mentioned earlier, Medigap is prohibited from covering Medicare Advantage cost-sharing while providing very comprehensive coverage with original Medicare.
Knowing pros and cons of medicare beforehand means you can make an informed Medicare decision if eligible for medicare. Medicare Advantage plans restrict your provider choice but attempting to switch back to original Medicare is difficult. Review both the pros and cons carefully based on your healthcare needs and preferences before choosing either traditional Medicare or a Medicare Advantage plan during open enrollment each year.
Hopefully this overview has helped explain the key disadvantages and restrictions of Medicare Advantage plans. Make sure to understand both the pros and cons when evaluating Medicare options. Your personal healthcare preferences and needs should drive your Medicare plan decision.
We’re Here to Help
You do not have to spend hours reading articles on the internet to get answers to your Medicare questions. Give the licensed insurance agents at American Entitlements a Call at (469) 814-0289. You will get the answers you seek in a matter of minutes, with no pressure and no sales pitch. We are truly here to help.
What is the difference between Medicare part a and part b and how does this relate to Medicare supplement insurance?
Part A covers hospital visits while Part B covers medical costs. Original Medicare has gaps so Medicare supplement plans, also called Medigap, help cover costs that Parts A and B don’t. Medicare Advantage plans may also include prescription drug coverage unlike original Medicare.
What are some cons of Medicare advantage plans compared to original Medicare plus Medigap?
Medicare Advantage plans often have restricted provider networks while original Medicare has broader access to any doctor that accepts Medicare. Network restrictions are a key disadvantage of Medicare Advantage plans vs the flexibility of original Medicare and Medigap.
What types of Medicare advantage plans are available and how do they differ?
There are HMO plans, PPO plans, and special needs plans—all private health plans with different coverage details. HMOs generally have small networks while PPO and special needs plans may have wider choice but not as broad as original Medicare and Medigap.
How much is the standard Medicare Part B premium versus premiums for Medicare advantage plans?
The Centers for Medicare and Medicaid set the Part B premium each year, currently around $170. However, Medicare Advantage plan premiums can vary greatly depending on the added benefits. Comparing specific plan premiums is important when deciding between original Medicare or a Medicare Advantage plan.
Can I switch from a Medicare advantage plan to original Medicare?
Yes, beneficiaries have a Medicare Advantage Open Enrollment Period each year during which they can switch from a Medicare Advantage plan back to original Medicare and enroll in a Part D drug plan and Medigap to gain broader coverage.
What advantages does a Medicare advantage plan have over original Medicare?
Many Medicare Advantage plans have additional coverage for services like vision/dental care, lowered out-of-pocket costs, and annual physicals. Medicare Advantage members also don’t pay a premium for Part B. However, coverage and costs depend on the specific plan.
What are some disadvantages of a Medicare advantage plan?
In addition to potential provider restrictions, Medicare Advantage enrollees have less freedom to switch plans if they’re unsatisfied compared to original Medicare plus Medigap. Another disadvantage is lack of coverage when traveling outside the plan’s service area. Network limitations are important to weigh.
How do I find and choose the best Medicare advantage plan for my needs in 2023?
Compare the different Medicare Advantage plans available in your area based on your preferred doctors, medications, and budget. Consider plan features like premiums, out-of-pocket limits, covered services and provider network to decide if a Medicare Advantage plan or original Medicare plus Medigap is right for your situation next year.
Do Medicare advantage plans cover all original Medicare benefits?
While most Medicare Advantage plans aim to provide equal or better benefits than original Medicare, sometimes certain benefits may not be fully covered. It’s important to thoroughly review coverage details of any Medicare Advantage plan you’re considering to be sure it will meet your expected healthcare needs before enrolling.
Are most Medicare beneficiaries satisfied with their Medicare advantage plan?
Satisfaction varies by plan and individual, but research has found about half of all Medicare Advantage enrollees don’t actually prefer their plan and would switch to original Medicare and Medigap if they better understood the options. Thoroughly examining the pros and cons of Medicare and Medicare Advantage plans is key to making the choice that’s right for you.