Finance & Economics

Everything you need to know about the medicare advantage plan

Lowell Rice

Content writer

 


This discussion covers an in-depth review of the Medicare Advantage plan, pros, cons, and valuable tips when looking for a Medical Advantage plan.

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Everything you need to know about the medicare advantage plan. Source: depositphotos.com

An Overview of Medicare

When choosing a Medicare plan, you’ll come across the Medicare Advantage and traditional Medicare.

Typically, these two insurance plans provide you with coverage against illnesses. However, the Medicare Advantage has several extra perks, including vision care and dental, which may be absent in the original Medicare.

Additionally, private insurance companies offer Medicare Advantage, and its availability depends on your state or city.

Medicare Categories

There are four main divisions of Medicare: parts A, B, C, and D.

Part A encompasses general hospital care, including hospice, skilled nursing, and home health care.

Part B incorporates medical insurance, including outpatient visits, X-rays, home health care, preventive services, and lab tests.

Part C is also referred to as the MA or Medical Advantage plans and it’s run by private insurance companies. However, the insurers must have running contracts with Medicare.

Part D covers prescription drugs. Private insurers run it with federal government contracts and traditional Medicare.

This section also includes a Medicare Advantage plan that does not cover prescription drugs. In this case, you’ll need to purchase the cover separately.

A hybrid Medicare Advantage plan with drug and health coverage is known as Medicare Advantage Prescription Drug (MA-PD) plan.

Medical Advantage Plan vs. Traditional Medicare Plan

As noted earlier, Medicare Advantage is a good alternative to traditional Medicare. Before diving into the differences, it’s important to know that the original Medicare was a government initiative started in 1965.

The main differences between the two Medicare plans come in the benefits, access to services, enrollment, and costs.

1. Benefits

When choosing a medical insurance package, the benefits rank top among your considerations.

Notably, the traditional Medicare provides a standard kit to cover important health care services. However, you’ll need to purchase prescription drugs under this package because they’re not covered.

In traditional Medicare, you can purchase a Part D prescription drug policy or Medigap plan to cover the medication. Essentially, a Medigap plan is a supplemental insurance package that private insurers run. It seals the gap left by the old Medicare, especially the lack of prescription drug coverage.

The Medigap plan is purely optional and doesn’t work with the Medicare Advantage or the traditional Medicare.

By contrast, the Medicare Advantage plan covers all that traditional Medicare provides. However, some plans may lack services such as vision care, hearing, dental, or subscriptions to health clubs. Fortunately, most have a prescription drug plan as the main benefit.

2. Costs

For traditional Medicare, how much you pay depends on your plan. The Part A option is free if your social security taxes are fully paid for at least ten years or 40 quarters.

If you opt for Part B, you’ll pay monthly premiums and out-of-pocket charges such as deductibles, co-pay as well as co insurance.

Traditional Medicare doesn’t have limits for out-of-pocket settlements or whatever expenses you incur. Additionally, you’ll need to buy a different package for prescription drugs or opt for a Medigap plan.

When it comes to Medicare Advantage, the costs may vary. Like the Part B of traditional Medicare, you’ll pay monthly premiums and out-of-pocket expenses. However, the cost depends on the type of plan that you choose.

For example, you may decide to pay an extra premium every month for additional benefits. Also, how much you pay for the services may differ depending on your service providers.

Some Medicare Advantage plans have a cost-share scheme where the charges exceed the traditional Medicare plan. Also, it may work to your advantage, and you may end up paying less.

Another thing to note is that the cost-sharing scheme is not mandatory for skilled nursing care, renal dialysis, and chemotherapy services. More so, if these exceed the cost-sharing under the traditional Medicare.

The Medical Advantage plans limit the out-of-pocket expenses for Part A and Part B. After that, you won’t be charged for the benefits under the cover for the year. Like most insurance packages, the benefits, co-pay, or premiums are subject to change every year.

3. Access to services

Traditional Medicare allows you to get treatment in any medical facility or hospital in the US under the Medicare program. You don’t need to have a prior authorization to get help in such facilities.

Under the Medical Advantage plan, there’s a limit to the number of service providers you can access. Normally, you’ll have to choose your primary doctor and get referrals to visit specialists.

You’ll also need the authorization to access specific services. If you wish to access providers outside your network, you’ll need to pay more. Some Medical Advantage plans may cover emergency care outside the service location, but you must go back to your service area for routine care.

Some network providers often join the plan or leave during the year. However, you can’t quit or change plans before the year ends, but you can swap providers during the year.

4. Enrollment

Enrollment into the traditional Medicare Part A is automatic as long as you pay into social security. Additionally, you’ll not pay monthly premiums under Part A. However, you can still opt for private Medicare Advantage to access premium services.

Payment of monthly premiums is required for category B, and penalties apply for payment delays or as specified by the provider.

By contrast, even though Medicare Advantage is optional, you must be in traditional Medicare A and B to be eligible for enrollment.  In this case, you’ll still enjoy all the benefits, rights, or protection under Medicare even though you’ve chosen the private option.

5. Right of appeal

Under both plans, you have the right to appeal if you feel that the coverage doesn’t meet your expectations. If you’re unhappy with decisions made under the plans, you can check on the timeline for appeal depending on your coverage.

The Pros of Medicare Advantage

From the discussion, it’s evident that Medicare Advantage is packed with multiple benefits.  Here are the highlights.

  • Even though you’ll need to pay extra premiums to access premium services, these can be cost savings for some pricy treatments. For example, dental and optical care costs are way above the roof for most people. So it’d help to join the Advantage plan and get broad-based protection at affordable prices.
  • The premiums are lower than those offered by private policies.
  • There’s a limit for out-of-pocket payments, which are set by the Centers for Medicare and Medicaid Services. The current limit is $7,550.

The Cons of Medicare Advantage

Despite the advantages, there are potential drawbacks of the Medicare Advantage plan.

  • You don’t have the luxury of choosing your preferred medical providers. You can only choose from the network.
  • It’s location-based, except  you have an emergency or need urgent care.
  • You can’t switch to traditional Medicare during the year.
  • Like any other insurance coverage, the network or insurer can end the plan anytime during the year depending on the policy guidelines.

Tips When Choosing The Best Medicare Advantage Plan

It’s not easy to choose your best Medicare Advantage since your health depends on getting reliable medical insurance. Here, we’ve explored valuable tips to help you settle on the best Medicare Advantage plan.

1. Budget

The cost of the Medicare Advantage plan includes the monthly premiums and out-of-pocket expenses such as copay and deductibles. All these costs boil down to your budget. You can find a medicare plan depending on how much you’re willing to spend on Medicare coverage.

The best part is that once you attain the allowable limit for out-of-pocket expenses, you’ll not pay anything, which makes the plan cost-effective.

2. Coverage

Coverage entails the plan covering your health services. Before you sign up, you can have a quick rundown of the services offered, location, and network providers. You can also check out for extra benefits under the plan, including dental and optical care.

3. Other insurance covers

As noted, you may have to purchase other plans, such as the prescription package, if you enroll for original Medicare.

If you have additional insurance covers such as those provided by employers, you can check if such packages are available. This saves you some money when enrolling for Medical.

4. Quality of care

Quality Medical care is an important aspect you need to keep in mind when choosing the right Medicare Advantage plan.

If you’re getting poor services, you can change your Medicare plan during the next enrollment.

5. Travel

If you travel a lot, especially outside the United States, the Medicare plans may not cover the expenses incurred outside the country. In this case, you can get a supplemental cover like Medigap to fill in the gap.

Conclusion

When choosing a Medicare plan, it’s important to understand each aspect to help you choose the best coverage that meets your needs. For help, you can consult a Medical Advantage representative in your area or the State Health Insurance Assistance Program or the SHIP.

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