What are Medicare Advantage Plans?
What is a Medicare Advantage Plan?
A Medicare Advantage Plan (also known as Part C) is a type of Medicare plan offered by a private company that contracts with Medicare to provide you with all your Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance) benefits. Most Medicare Advantage Plans also offer prescription drug coverage. Medicare Advantage Plans include Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), Private Fee-for-Service Plans, Special Needs Plans, and Medicare Medical Savings Account Plans.
The Basics of Medicare Advantage Plan
Medicare Advantage Plans are an alternative way to get your original Medicare benefits, which are provided via Parts A and B. The plans are offered by private insurance companies and approved by Medicare although Medicare does not endorse any plan. These companies must follow the rules set by Medicare, but they have the flexibility in setting out-of-pocket costs and some plans may offer extra benefits.
Here are some of the key characteristics of a Medicare Advantage Plan:
- Coverage: Medicare Advantage Plans typically cover all of the services that Original Medicare cover. Many plans also offer additional benefits not covered by Original Medicare. Many also include Part D prescription drug coverage to provide drug benefits.
- Provider Networks: With a Medicare Advantage Plan, you are generally required to use doctors and hospitals that are in the plan’s network. If you use out-of-network providers, you might have to pay more.
- Costs: You still pay your Part B premium when you have a Medicare Advantage Plan. However, each Medicare Advantage Plan has different premiums, deductibles, and out-of-pocket maximums. In some cases, the premiums can be lower than what you would pay with Original Medicare.
- Eligibility: To be eligible for a Medicare Advantage Plan, you must already have Medicare Parts A and B, live in the plan’s service area.
- Types of Plans: There are several types of Medicare Advantage Plans: Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), Private Fee-for-Service (PFFS) plans, Special Needs Plans (SNPs), and Medicare Medical Savings Account (MSA) plans.
- Medicare Advantage Plans are NOT Medicare Supplement Plans. Medicare Supplement Insurance allow you to keep your Original Medicare coverage.
It is important to carefully research and compare plans as the coverage, costs and provider networks can all vary. Also, the plan rules can change from year to year, so it is crucial to review your plan annually to ensure it still meets your needs and budget.
How Does Medicare Part C Relate to Medicare Advantage?
Medicare Part C is actually another name for Medicare Advantage.
Advantage and Original Medicare: Differences and Similarities
Medicare Advantage and Original Medicare are two ways that people can choose to receive their Medicare benefits. While they both cover a wide range of health care services, they differ significantly in terms of costs, coverage, flexibility, and other factors. The similarities and differences between these two forms of Medicare can influence which one is right for an individual.
1. Coverage: Both Original Medicare Part A and Part B and Medicare Advantage Plans cover a wide range of health care services. This includes inpatient and outpatient care, preventive services, laboratory tests, medical equipment, and more.
2. Protection: Both types of Medicare offer certain guarantees and rights to individuals, such as the right to appeal a coverage decision.
3. Eligibility: In general, anyone who is eligible for Medicare Part A (hospital insurance) and Part B (medical insurance) can choose between Original Medicare and Medicare Advantage.
4. Medicare Part D Coverage: Both Original Medicare and Medicare Advantage may give you the option to add prescription drug coverage.
1. Costs: With Original Medicare, individuals usually pay a percentage of the cost for each service they use. With Medicare Advantage, individuals often pay a set copayment for each service. Plus, Medicare Advantage plans have an annual out-of-pocket maximum, while Original Medicare does not.
2. Coverage of extra services: Medicare Advantage plans often include additional benefits that Original Medicare does not cover.
3.Choice of health care providers: With Original Medicare, individuals can go to any doctor or hospital that accepts Medicare. With Medicare Advantage, individuals often need to use doctors or hospitals in the plan’s network.
4. Out-of-pocket costs: Medicare Advantage plan sets a limit on what you pay out-of-pocket each year for covered services. But, Original Medicare has no maximum limit on out-of-pocket costs.
5. Requirement of Referral: In some Medicare Advantage plans, like HMOs, you might need a referral from your primary care doctor to see a specialist. In Original Medicare, you do not need a referral.
Choosing between Original Medicare and Medicare Advantage depends on an individual’s health care needs, budget, and personal preferences. It’s important to understand the differences and similarities between these two options to make the right decision.
What are the different types of Medicare Advantage Plans?
There are many different types of Medicare Advantage Plans and they are all unique in how they work.
- Health Maintenance Organization (HMO) Plans: These plans require beneficiaries to use a network of doctors and hospitals. An HMO plan does not cover out-of-network care except in emergencies.
- Preferred Provider Organization (PPO) Plans: Beneficiaries can see any healthcare provider but have lower out-of-pocket costs if they use providers in the plan’s network. In some cases, Part D prescription drug coverage is included.
- Private Fee-for-Service (PFFS) Plans: PFFS plans allow beneficiaries to see any doctor or hospital that accepts the plan’s terms. Similar to PPO plans, coverage outside of this network usually results in higher out-of-pocket costs.
- Special Needs Plans (SNP): SNPs are exclusively for people with specific chronic conditions, those who reside in a nursing home, or those who participate in both Medicare and Medicaid. SNPs tailor benefits, provider choices and drug formularies to best meet the specific needs of the groups they serve.
- Medicare Medical Savings Account (MSA) Plans: MSA plans combine a high-deductible insurance plan with a medical savings account that beneficiaries can use to pay for healthcare costs.
- Medicare Cost Plans: These are HMO plans that allow beneficiaries to use out-of-network providers for non-emergency care, usually at a higher cost. These plans are only available in certain parts of the country.
How to Enroll in a Medicare Advantage Plan?
Enrolling in a Medicare Advantage Plan starts with determining eligibility. You are eligible if you have already enrolled in Part A and Part B of Medicare, you live in the service area of the Medicare Advantage Plan that you are considering.
The first step is to get in touch with either the Medicare program directly or talk to a local insurance agent, like American Entitlements, who specializes in this type of coverage. To contact Medicare directly, you can either go online to www.medicare.gov, or you can reach their toll-free hotline at 1-800-MEDICARE.
Next, remember that the annual “open enrollment” period for Medicare Advantage Plans occurs from October 15 to December 7 of each year. Outside these dates, you may not be able to enroll in a Medicare Advantage Plan unless you are new to Medicare, losing your current coverage or moving out of your current plan’s service area.
When you’re ready to enroll, you’ll need to provide your Medicare number and the date your Part A and/or Part B coverage started. This information is on your Medicare card. Make sure to review each plan’s costs, what services are covered, and any restrictions before making your decision.
In addition, you may have to be careful about when you decide to leave a Medicare Advantage Plan. In certain situations, you may be able to join a Medicare Advantage Plan or Medicare Prescription Drug Plan, or you may be able to switch plans.
It is important to consider all of these factors and take your time when deciding on whether or not to enroll in a Medicare Advantage Plan.