Medicare Advantage Plans (Medicare Part C)

Get Expert Help With Your Medicare Advantage Plan Options

The advertisements for Medicare Advantage Plans never stop… TV commercials, radio commercials, Facebook ads, Youtube ads, direct mail, telemarketers, door knockers, and more… You can’t escape it!

But what exactly are they trying to sell you? And is there any truth to what they are selling? We’ll help you find the truth so you don’t get taken advantage of and don’t enroll in the incorrect plan.

The truth is Medicare Advantage plans can be very good plans… as long as you understand exactly what you’re signing up for. However, there are many things you should be aware of before enrolling in one of these plans. Education is key.

The Two Types of Medicare Coverage

There are two main ways to get Medicare coverage. You can choose Original Medicare or a Medicare Advantage Plan.

Original Medicare

Original Medicare is a government-provided fee-for-service health plan. It has two parts: Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance). Generally, there is a cost for each service you use. You will likely pay a set amount (deductible) before Medicare pays its share. Then, Medicare will pay a share (coinsurance or copayment) for covered services. In most cases, you go to any healthcare provider enrolled in Medicare. With Original Medicare, you may add prescription drug coverage (Part D) and a Medicare Supplement Plan (Medigap).

Medicare Advantage Plans

Medicare Advantage Plans (also known as Medicare Part C) are a type of Medicare health plan offered by private insurance carriers that contract with Medicare. These plans bundle Medicare Part A, Medicare Part B, and usually Medicare Part D (prescription drug) services. Often, these plans offer extra benefits that Original Medicare does not cover, such as vision, hearing, and dental benefits. However, in most cases, you must go to the insurance carrier’s network of healthcare providers and facilities. You also may need to get approval from your plan before certain services.

How Medicare Advantage Plans Work

Medicare Advantage Plans are commonly called “MA Plans.” As mentioned above, private insurance carriers offer Medicare Advantage Plans, but they must follow rules set by Medicare. There are many types of Medicare Advantage Plans, with the most common types being a Health Maintenance Organization (HMO) or Preferred Provider Organization (PPO). Each type of plan has different rules about how you’ll get your healthcare services.

Medicare Advantage Plans must cover all Medicare Part A and Part B services; however, you’ll get most of your Part A and B services from your Medicare Advantage Plan, not from Original Medicare. Clinical trials and hospice services are the only Part A and B services not through your MA Plan. You will still get these two services from Original Medicare. With MA Plans, you may get benefits that Original Medicare doesn’t cover, like gym memberships, vision services, hearing services, dental services, and more. Most Medicare Advantage Plans also include prescription drug coverage (Part D). MA Plans also have an annual limit on out-of-pocket costs for all Part A and Part B services. (Note: there is no maximum out-of-pocket limit with Original Medicare.)

If you join a Medicare Advantage Plan, Medicare (i.e. the U.S. government) will pay a fixed dollar amount for your coverage each month to the insurance carrier you enroll with. The insurance carrier will use this money to help manage your healthcare. However, the insurance carriers will also charge you additional amounts as you use services. Each Medicare Advantage Plan can charge different amounts and have different rules for services. However, all MA Plans have general rules, guidelines, and protections.

How Much Do Medicare Advantage Plans Cost?

The costs of Medicare Advantage Plans vary widely. Each particular plan sets the amounts they charge for services (albeit within Medicare guidelines). The Plans may also change what they charge every year on January 1.

Below are the types of costs you may incur. Keep in mind the amounts will vary depending on the Plan.

Premium – The amount you pay for your Medicare Advantage plan every month. Many MA Plans charge an additional monthly premium in addition to the standard Medicare Part A and Part B premiums. However, many $0 premium options are often available in many areas.
Deductible – The amount you pay for healthcare or prescriptions before your Medicare Advantage Plan begins to pay.
Coinsurance – An amount you may be required to pay as your share of the cost of services after you pay your deductible. This is usually a percentage, such as 20%.
Copayment – An amount you may be required to pay as your share of the cost for a medicare service or supply. A copayment is usually a set amount rather than a percentage. For example, $10.

All Medicare Advantage Plans have a Maximum Out-of-Pocket Limit which is the maximum amount you must pay for Part A and B covered services.

If you enroll in a Medicare Advantage Plan, you must still pay the Medicare Part A (if applicable) and Part B premiums. Some low-income earners may get help paying for these premiums.

How Do You Enroll in a Medicare Advantage Plan?

To enroll in a MA Plan, you must:

Have both Medicare Part A and Part B
Live in the Plan’s service area
Be a U.S. citizen or lawfully present in the U.S.

You can only join, switch, or drop a MA Plan during specific periods of the year. The enrollment periods are described below:

Initial Enrolment Period (IEP) – When you first become eligible for Medicare, you will get seven months to enroll in a MA Plan. If you turn 65, this period begins three months before you turn 65, includes the month you turn 65 and lasts three months after you turn 65.
Open Enrollment Period (OEP) – Anyone with Medicare can join, switch, or drop a MA Plan every year between October 15th and December 7th. The change will be effective January 1 of the new year.
MA Open Enrollment Period (MA OEP) – If you are currently on a MA Plan, you can make a change once every year between January 1st and March 31st.
Special Enrollment Period (SEP) – In special situations, you may be able to join, switch, or drop a MA Plan. Examples include moving out of a service area or losing employer coverage.

You can find and compare Medicare Advantage Plans in your area by visiting Medicare.gov, calling 1-800-MEDICARE, or contacting a licensed insurance broker.

Types of Medicare Advantage Plans

Health Maintenance Organizations (HMO)

An HMO plan generally provides health care coverage exclusively from a network of doctors, providers, hospitals, and facilities contracted with the plan. Most HMOs also require you to get a referral from a primary care doctor for specialist care. In most cases, if you see a provider outside of the plan’s network, you must pay 100% of the costs. Many HMO plans include prescription drug coverage.

Preferred Provider Organizations (PPO)

A PPO also has a network of doctors, providers, hospitals, and facilities contracted with the plan. However, you can also use out-of-network providers for covered services (at a higher cost). With most PPO plans, you will not be required to get a referral for specialist care. Many PPO plans also include prescription drug coverage.

Private Fee-for-Service (PFFS)

With a PFFS plan, you can go to any Medicare-approved doctor, provider, or hospital that accepts the plan’s payment terms, agrees to treat you and hasn’t opted out of Medicare. Some PFFS plans have a network, and some do not. If your PFFS plan has a network, you may have to pay more to go outside the network. With a PFFS plan, you must ensure that provider or hospital agrees to your plan’s terms before any services. These plans sometimes include prescription drug coverage. If your PFFS plan doesn’t offer drug coverage, you can join a separate Medicare drug plan.

Special Needs Plans (SNP)

Special Needs Plans provide benefits and services to people with specific diseases, particular health care needs, or who also have Medicaid coverage. These plans tailor their benefits, provider choices, and list of covered drugs to best meet the specific needs of the group they serve. SNPs can are typically either a PPO or HMO plan. Each SNP limits its membership to people in a specific group. And you can only stay in the plan if you continue to meet the special conditions.

1. Chronic condition SNP (C-SNP)

You must have one or more specific severe or disabling chronic conditions. Examples may be Diabetes mellitus or certain chronic heart disorders.

2. Institutional SNP (I-SNP)

You must need the level of care a facility offers or live for at least 90 days straight in a facility such as a nursing home.

3. Dual Eligible SNP (D-SNP)

You must be eligible for both Medicare and Medicaid. These plans coordinate with the state’s Medicaid program to coordinate benefits.

Medicare Medical Savings Account (MSA)

MSA Plans combine a high-deductible insurance plan with a medical savings account that you can use to pay for your healthcare costs. These plans generally don’t have a network of healthcare providers. MSA Plans do not cover prescription drugs. You will need to join a separate Medicare drug plan.

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