Medicare Advantage Plans are an alternative way to get your Medicare Part A and Part B coverage. Medicare Advantage Plans, sometimes called “Part C” or “MA Plans,” are offered by private companies that have been approved by Medicare, and must abide by a set of rules set forth by Medicare. Most Medicare Advantage Plans include drug coverage (Part D), and do not require an additional Part D plan be purchased. In most cases, you’ll need to use in-network health care providers, who participate in the specific plan’s network. These plans are designed to set a limit on what you’ll have to pay out-of-pocket each year for covered services.
There are different types of Medicare Advantage plans to choose from. Medicare Advantage Plans include Health Maintenance Organizations (HMO), Preferred Provider Organizations (PPO), Private Fee-for-Service Plans (PFFS), Special Needs Plans (SNP), and Medicare Medical Savings Account Plans (MSA).
Medicare Advantage Plans differ from one another in a few ways such as:
- The network of doctors available
- The amount of out-of-pocket costs that the individual will be responsible for paying
- Referral requisition for certain specialists
The basic components of Medicare Advantage (MA) plans are as follows:
- Medicare pays a fixed amount for an individual’s care each month to the private insurance company providing your Medicare Advantage plan
- Individuals are responsible for paying your regular monthly Part B monthly premium in addition to the Medicare Advantage (Part C) – plan premium
- Individuals who enroll in a Medicare Advantage Plan cannot have a Medicare Supplement Policy.
- These private insurance companies must follow rules set by Medicare, one of which is that a Medicare Advantage plan must provide enrollees with the same benefits they would receive under Original Medicare. (Medicare Part A including hospital stays, skilled nursing care, and home health care. Part B including doctor visits, outpatient care, screenings, shots, and tests).
The benefits of Medicare Advantage plans are as follows:
- The total cost of the deductibles, premiums and co-pays that an individual will pay using an Advantage plan is often lower than the total cost for those same expenses under Original Medicare.
- The advantage plan combines Parts A, B, and D into one plan with one Medicare ID Card.
The Medicare Program rates all health and prescription drug plans each year, based on the plan’s quality and performance. A plan can get a rating between 1 and 5 stars (5 stars indicating the best possible service). These stars allow you to easily compare plans based on quality and performance, and they are updated every year (typically in the fall).
When deciding on which Medicare Advantage plan to choose, you should consider speaking with a local Medicare agent to answer the following questions: