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What are the Pros and Cons of Switching to a Medicare Advantage Plan?

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Medicare Advantage, also known as Medicare Part C, makes it possible for people with Medicare Part A (hospital insurance) and Part B (medical insurance) to receive their Medicare benefits in an alternative way. Medicare Advantage plans are offered by private insurance companies contracted with Medicare and provide at least the same level of coverage that Medicare Part A and Part B provide.

You may be wondering which is the better choice: sign up for a Medicare Advantage plan or Original Medicare. There isn’t a simple answer because Medicare Advantage plans have key features that many people find attractive and other characteristics that may not match with your personal preferences and/or lifestyle. Let’s take a closer look at some of the important pros and cons of Medicare Advantage plans.

Pros of Medicare Advantage plans

Medicare Advantage plans often provide more benefits than you would receive under Original Medicare.

Medicare Advantage plans must offer at least the same level of coverage as Medicare Part A and Part B and many plans offer added benefits. These may include coverage for routine vision care, hearing aids, routine dental care, prescription drug coverage, and fitness center membership.

Medicare Advantage plans may cost you less.

If you enroll in a Medicare Advantage plan, you continue to pay your Medicare Part B premium and you may pay an additional premium. The insurer determines the Medicare Advantage plan’s premium, which can vary from one Medicare Advantage plan to another. Some Medicare Advantage plans may have premiums as low as $0.

Your cost sharing may also be less under Medicare Advantage. For, example, if you visit a primary care physician under Medicare Advantage, you may pay a copayment of $10. However, if you visit a primary care physician under Original Medicare, you may have a coinsurance of 20%, which could be more than $10.

Also, a Medicare Advantage plan limits your maximum out-of-pocket expense. Once you have spent that maximum, you pay nothing for covered medical services for the remainder of the year. Original Medicare does not provide a maximum out-of-pocket cap, so your potential expenses are limitless (and therefore could be much higher than $6,700, the maximum amount a Medicare Advantage plan can set in 2018).

Often a Medicare Advantage plan can be less expensive than comparable coverage you would receive if you stayed with Original Medicare. To get all the benefits of Medicare Advantage with Original Medicare, you would also need to enroll in a stand-alone Medicare Part D Prescription Drug Plan as well as a Medicare Supplement plan.

Medicare Advantage plans coordinate care among your health care providers.

Typically Medicare Advantage plans are managed care and have networks of contracted health care providers. Example would be Health Maintenance Organization (HMO) Medicare Advantage plans. These HMO plans require you to select a Primary Care Physician (PCP) who helps to coordinate your care.

Medicare Advantage plans that include prescription drug coverage may also have medication therapy management. This care coordination can be a convenience and a valuable aid to your health.

Medicare Advantage plans can serve as your “one-stop” center for all your health and prescription drug coverage needs.

Most Medicare Advantage plans combine medical and Part D prescription drug coverage. Many also coordinate the delivery of added benefits, such as vision, dental, and hearing care. You may prefer the convenience of working with one plan administrator.

Cons of Medicare Advantage plans

Medicare Advantage plans may limit your freedom of choice in health care providers

With the federally administered Medicare program, you can generally go to any doctor or facility that accepts Medicare and receive the same level of Medicare benefits for covered services. In contrast, Medicare Advantage plans are more restricted in terms of their provider networks. If you go out of network, your plan may not cover your medical costs, or your costs may not apply to your out of pocket maximum.

Medicare Advantage plans’ coverage for some services and procedures may require doctor’s referral and plan authorizations.

Medicare Advantage plans try to prevent the misuse or overuse of health care through various means. This might include prior authorization for hospital stays, home health care, medical equipment, and certain complicated procedures. Medicare Advantage plans often also require your primary care doctor’s referral to see specialists before they will pay for services.

Medicare Advantage plans have specific service areas.

Most Medicare Advantage plans have regional (rather than nationwide) networks of participating providers. To enroll, you must reside in the Medicare Advantage plan’s service area at least 6 months of the year. If you divide your time between homes located in different areas, this requirement may be difficult to meet.

The bottom line is that Medicare Advantage plans may provide more affordable coverage than you would receive otherwise. The trade-off is that you have to follow the Medicare Advantage plan’s rules to receive payment for covered services.

Do you have other questions about Medicare Advantage?  Call us and speak with a licensed insurance agent about finding Medicare Advantage plans in your area and your Medicare coverage options. Or just enter you zip code on this page.

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