Medicare Advantage Plans are a type of Medicare health plan offered by a private company that contracts with Medicare to provide all your Part A and Part B benefits. Most Medicare Advantage Plans also offer prescription drug coverage. If you’re enrolled in a Medicare Advantage Plan, most Medicare services are covered through the plan. Your Medicare services aren’t paid for by Original Medicare. Below are the most common types of Medicare Advantage Plans.
Medicare Advantage Plans, sometimes called "Part C" or "MA Plans," are an “all in one” alternative to Original Medicare. They are offered by private companies approved by Medicare. If you join a Medicare Advantage Plan, you still have Medicare. These "bundled" plans include Medicare Part A (Hospital Insurance),and Medicare Part B (Medical Insurance), and usually Medicare Prescription Drug Plan (Part D).
Medicare Advantage Plans cover all Medicare services. Some Medicare Advantage Plans also offer extra coverage, like vision, hearing and dental coverage.
Medicare pays a fixed amount for your care each month to the companies offering Medicare Advantage Plans. These companies must follow rules set by Medicare. Each Medicare Advantage Plan can charge different out-of-pocket costs. They can also have different rules for how you get services, like:
What you pay in a Medicare Advantage Plan depends on several factors. Like the type of plan, the size of the network, and what ancillary products are included. Also, plans are priced generally by county so prices can vary quite a bit from city to city and state to state.
Most Medicare Advantage Plans include Prescription Drug Coverage (Part D). You can join a separate Medicare Prescription Drug Plan with certain types of plans that:
You’ll be disenrolled from your Medicare Advantage Plan and returned to Original Medicare if both of these apply:
Medigap policies can't work with Medicare Advantage Plans.
You can generally join one of these Medicare Advantage plans:
If all of these apply:
If you're already in a Medicare Advantage Plan and want to switch, follow these steps:
Unless you have other drug coverage, you should carefully consider Medicare Prescription Drug Plan (Part D). You may also want to consider a Medicare Supplement Policy or a Medigap Plan. Remember, you may only be able to switch at plans at certain times of the year.
Talk to your employer, union, or other benefits administrator about their rules before you join a Medicare Advantage Plan. In some cases, joining a Medicare Advantage Plan might cause you to lose employer or union coverage. If you lose coverage for yourself, you may also lose coverage for your spouse and dependents.
In other cases, you may still be able to use your employer or union coverage along with the Medicare Advantage plan you join. Remember, if you drop your employer or union coverage, you may not be able to get it back.
At the end of the year, plans can decide to leave the Medicare Program. If your plan leaves, you'll get a letter explaining your options.Generally, you'll be automatically returned to Original Medicare if you don't choose to join another Medicare Advantage Plan. You will also have the right to buy a Medigap policy.
No matter what you choose, you're still in the Medicare Program and will get all Medicare-covered services. If you choose to go back to Original Medicare, you need to decide if you want drug coverage. If so, you need to join a Medicare Prescription Drug Plan (Part D).
It’s important to understand how your current coverage works with Medicare. If you have questions about your current insurance, the best source of information is your benefits administrator, insurer, or plan provider.
Some people get Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance) automatically and other people have to sign up for it. In most cases, it depends on whether you’re getting Social Security benefits.
Note: Medicare is managed by the Centers for Medicare & Medicaid Services (CMS). Social Security works with CMS by enrolling people in Medicare.
Note: You don’t need to sign up for Medicare each year. However, each year you’ll have a chance to review your coverage and change plans.
Generally, a Medicare Health Plan:
Medicare Health Plans Include:
Medicare Advantage Plans offer lower premiums but require you to use their own networks of Doctors and Hospitals, this enables them to lower their costs.
A Medicare HMO (Health Maintenance Organization) Usually require you only see network providers, except in emergencies. You'll need to select a primary care physician. That physician will authorize and coordinate a referral if you need to see a specialist.
Medicare HMO plans are the most largest type of Medicare Advantage networks. HMO's make up over 70% of the Medicare Advantage marketplace.
Medicare PPO (Preferred Provider Organization) networks allow you to see doctors outside the network but you will expect to pay much higher out-of-pocket costs to do so.
In limited counties, there are Medicare Private-Fee-for-Service plans. These plans may or may not include Part D. How you access care is also different. While this plan type was very common in the past, it has been slowly phased out in most areas.
Some people may feel like the rules restrict or limit them in ways that are disagreeable. However, others are willing to abide by the rules if they find a plan with an attractive low premium.
It’s a personal choice. If you are deciding between Medicare Advantage and Medigap, you’ll want to consider some of the rules before you enroll.
Medicare Advantage plans have lock-in periods. You can enroll in one during Initial Enrollment Period when you first turn 65. After that, you may enroll or dis-enroll only during certain times of year. Once you enroll in Medicare Advantage, you must stay enrolled in the plan for the rest of the calendar year. You can only opt-out from an Advantage plan during specific times of the year.
The Annual Election Period in the fall is the most common time to change your Medicare Advantage plan. This period runs from October 15th – December 7th each fall. Changes made to your enrollment will take effect January 1.
If you decide to leave a Medicare Advantage plan and return back to Original Medicare, you must notify your Medicare Advantage plan carrier. Otherwise Medicare will continue to show that you are enrolled in the Advantage plan instead of Medicare.
Some people don’t realize this and join Medicare Advantage plans without the help of an agent. Therefore they don’t know about all of these rules. Sometimes they find themselves enrolled into a plan that their doctor doesn’t accept or that doesn’t include one of their medications. This happens most often in January after a person has used the Annual Election Period to join a Medicare Advantage plan.
The Medicare Open Enrollment Period that runs from January 1st – March 31st each year. During this time, you can disenroll from any Medicare Advantage plan and return to Original Medicare. You will be allowed to add a standalone Part D Prescription Drug Plan.
During the Medicare Advantage Open Enrollment Period you can also change from your current Medicare Advantage plan to a different Medicare Advantage plan. Please be aware that you can only use this period once per calendar year.
The intent of our lawmakers in creating these plans was to give you options in accessing your Medicare benefits. Listed below are some of the reasons why people might choose a Medicare Advantage plan:
You can either opt for Original Medicare (Medicare Parts A & B) and supplement it with a Medicare Supplement plan or a Medigap plan and/or a Medicare Prescription Drug plan or (Part D), or you can choose a Medicare Advantage plan (Medicare Part C) . A Medicare Supplement or Medigap plan will pick up the tab for all or part of your deductibles and coinsurance under Original Medicare (the level of coverage you get depends on the Medigap plan you choose), and a Part D plan will provide prescription coverage. A Medicare Advantage plan wraps everything all in one policy: It includes all of the benefits of Original Medicare, has a cap on annual out-of-pocket costs, and most Medicare Advantage plans also include prescription coverage.