Medicare Advantage Plans

Medicare Advantage Plans are health plans approved by the federal government and run by private companies. These plans are also sometimes referred to as Medicare Part C. Medicare Advantage Plans are not supplemental insurance and must follow rules set by Medicare.

Medicare Advantage Plans will provide benefits at least equal to those in Medicare Part A – Hospital and Medicare Part B – Medical. Medicare Advantage Plans may have different doctor co-payments, hospital coinsurance, and deductibles for than original Medicare coverage. Key differentiators for Advantage plans are the maximum out-of-pocket expenses that could possibly occur in a twelve (12) month period, current doctor’s network and your current formulary of prescriptions supported in the plan. These three (3) areas are recommended to be confirmed before final selection of any advantage plan.

Depending on the plans in your state, some Medicare Advantage plans have a maximum out-of-pocket expense that range from a few hundred to several thousand dollars per year. There is a balance between making sure you are comfortable with your plan and understanding the financial risk versus the lower premiums.

Medicare Advantage Plans might also offer added benefits as incentives, such as some benefits for vision, hearing, dental, and/or health and wellness club membership programs and most will include prescription drug coverage for an additional cost.

Most companies offering Medicare Advantage Plans have automatic claims filing. That means you do not have to worry about filing a claim with the insurance company. With Medicare Advantage claims, your doctor submits an approved medicare service bill to the insurance company, the insurance company checks it against its covered services agreement with medicare, then the insurance company pays the doctor. The services agreement made with Medicare can change each year. It does not have standardized coverage like a Medicare Supplement Plan. Before renewing a Medicare Advantage plan each year, you should check your coverages as per that plan.

Types of Medicare Advantage Plans

Health Maintenance Organization (HMO) – Offers low to no co-payment for doctor office visits and no deductibles. However, you are required to receive a referral from your Primary Care Doctor before seeing a specialist, and to receive full benefits, you must use doctors and hospitals that are within the provider’s network.
Preferred Provider Organization (PPO) – These plans also offer low co-payments that are usually slightly higher than those of an HMO. But also allow freedom of choice when choosing a doctor or hospital as long as they are part of their network.
Private Fee-for-Service (PFFS) Plans – PFFS plans usually offer the most flexibility. As they allow you to choose any doctor or hospital of your choice because there is no provider network. However, your doctor or hospital must accept the plans conditions prior to treating you, except in the case of emergencies.
Medical Savings Account – This is a very popular option. This plan combines a high deductible health plan with a medical savings account. The government will put money in this account, which you can use to pay your deductible or other out-of-pocket medical expenses such as dental and vision care.

What are the differences between Medicare Advantage Plans and Medicare Supplements?