Medicare Advantage Simplified:

Medicare Advantage are private health insurance plans that are approved by Medicare. By choosing a Medicare Advantage plan, you choose to get your Part A, Part B, and often Part D benefits through the private insurance company rather than traditional Medicare and a Part D plan. These Medicare private insurance plans usually have an HMO or PPO network of doctors and usually will cover above and beyond what Original Medicare covers. 

Medicare Advantage In Depth

Medicare Advantage plans were signed into law in 1997 as an alternative to Original Medicare and Medigap. When you enroll in a Medicare Advantage plan you are choosing to make your primary insurer the private insurance company rather than Medicare. Medicare then pays the insurance company to provide you Part A and Part B benefits and often Part D benefits on your behalf. Medicare Advantage plans usually take the form of HMO or PPO plans that use a network of doctors. 

To be eligible for Medicare Advantage you must continue to pay your Medicare Part B premium and be enrolled on Part A. You must also reside in that plans service area.

Medicare Advantage policies are NOT Medigap plans. Medigap plans pay AFTER Medicare and Medicare Advantage pay INSTEAD of Medicare. Learn more about how Medicare Advantage works here.

Medicare Advantage Coverage

With Medicare Advantage growing every year, many new to Medicare will ask for the pros and cons of Medicare Advantage plans vs Original Medicare + Medigap. Both options will give good coverage but the difference often comes down to how you access this coverage and the price. 

Let’s look at Original Medicare. You can visit any doctor who accepts Medicare, most do, with no referrals or prior authorization. You are responsible for deductible for Part A and Part B and 20% for Part B payments. The doctor or hospital will bill Medicare directly for Medicare’s share, then you will pay the remainder. If you have a Medigap plan, it will help you cover these out of pocket costs.

A Medicare Advantage plan will give you a network of doctors you can see and you may need a referral or prior authorization to see the doctor. You will pay a copayment, or a set fee, when you receive healthcare services. These payments can differ from plan to plan and area to area. For example, you might pay a small copay for a primary care doctor visit, and a higher copay to see a specialist. 

Perhaps one of the biggest differences is that Medicare Advantage plans often cover above and beyond what Medicare covers.  These plans often offer coverage for hearing, vision, dental, gym, and Part D benefits.

For more on what Medicare Advantage, see our Medicare Advantage – Part C page. 

Why Medicare Advantage?

Original Medicare plus a supplement and Part D plan are excellent coverage and was really the only option for a long time. But, with the Part B premium, Medigap premium, and Part D premium, this option was often very financially straining or out of reach for many on Medicare. Many opted to have only Original Medicare which leaves them exposed if and when illnesses or accidents occur. Returning home from a hospital stay with large medical bills and possible health issues. Many would then try to get a Medigap plan, but only to be denied due to the new medical conditional. Unfortunately this led many into medical bankruptcy or severely limited financially. 

Medicare Advantage plans provided a solution to these problems by offering a lower cost alternative with only 1 disqualifying disease, ESRD or end stage renal disease. These plans can be joined during certain times of the year called enrollment periods and cannot be denied for any reason besides ESRD.

As Medicare Advantage grew and expanded, many other “advantages” over Original Medicare and even Medigap plans formed. Medicare Advantage plans were also built with an out-of-pocket maximum cap on your medical spending. Think of this as a safety net. Any out of pocket expenses paid for you in a calendar year are tracked and are capped at a maximum of $6700 and often much less. (Part D expenses are calculated separately).

A major bonus of Advantage plans is that they often include benefits above and beyond original Medicare. They often include built in Medicare Part D drug plan, hearing, vision, dental, gym, and Part D benefits and often much more. This is all bundled into one package which makes these plans very cost effective and convenient. 

Joining a Medicare Advantage plan

To join a Medicare advantage plan you must be in an enrollment period. The annual enrollment period that runs from October 15 – December 7 of each year is the usual time to join a Medicare Advantage plan. There are other special periods to join a plan throughout the year, such as moving. 

Medicare Advantage plans have different networks, premiums,cost sharing and extra benefits. So working with an insurance agent that specializes in these plans. There can sometimes be dozens of options in an area and going through your needs and budget.

Medicare Advantage is better explained in a one-on-one setting. Get help from our Medicare insurance experts today at +1 888-603-9445