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When it’s time to choose your Medicare coverage, you have two main options: Original Medicare (Part A and Part B) or Medicare Advantage. Most people are familiar with Original Medicare, but you may be wondering, “What is Medicare Advantage?” This article will explain the key differences between Medicare Advantage and Original Medicare, and how to choose which option is right for you.
Medicare Advantage, also known as Medicare Part C, is offered by private insurance companies, and has all the core benefits of Original Medicare. Under federal law, all Medicare Advantage plans must provide the same coverage as Part A and Part B, at a minimum. Once those requirements are met, however, companies offering Medicare Advantage are able to structure their plan benefits to best meet the needs of their members.
For example, most Medicare Advantage plans include Part D coverage for prescription drugs. For one monthly premium, you get all your Medicare benefits in a single plan.
Many plans also include additional coverage for things like routine vision, hearing, and dental care, which aren’t typically covered by Original Medicare. You may also find plans that cover the Silver Sneakers free gym membership and wellness program, and even pay for certain medical expenses when you travel outside the U.S.
It’s important to look at the different benefits in each of the plans you are considering and compare premiums to make sure your plan is a good fit. Keep in mind that you have to pay your normal Part B premium in addition to any monthly premium your Medicare Advantage plan requires.
Health maintenance organizations (HMOs) and preferred provider organizations (PPOs) are two of the most common types of Medicare Advantage plans.
Medicare Advantage HMOs generally require you to choose a primary care provider who oversees your health care. You’ll usually need a referral to see a specialist, and you must get all of your care (except in the case of medical emergencies) from providers within the plan network. These plans often have lower monthly premiums than other Medicare Advantage plans.
Medicare Advantage PPOs* usually let you see any provider who accepts your plan, but you pay less out of pocket when you use network providers. You generally don’t need to choose a primary care doctor or need referrals to get specialist care.
There are other types of Medicare Advantage plans, including private fee-for-service (PFFS)** and Special Needs Plans (SNPs). PFFS plans pay a set amount for health care services and you can use your plan with any provider who accepts it, although not all providers do. SNPs restrict enrollment to people who have certain serious or chronic health conditions, or who live in a nursing home, or are eligible for both Medicare and Medicaid.
Not all plan types are available in all areas, and benefits may vary from plan to plan. Your plan premium may also vary depending on where you live.
Medicare Advantage plans tend to look more like the private insurance you may have had with your employer or other group. Under Original Medicare, you have two deductibles, one for Part A and one for Part B. However, under a Medicare Advantage plan, you’ll only pay one deductible if your plan requires one.
In addition, many Medicare Advantage plans use a flat copayment amount for cost sharing as opposed to a percentage of actual charges. With Part B, for example, you pay 20% of all allowable charges when you go to the emergency room. With Medicare Advantage, however, you may pay just a flat $50 copayment. Some people find the copayment system of cost-sharing makes it easier to plan for health care expenses.
Many Medicare Advantage plans use a tiered copayment system for prescription drug coverage, if your plan includes Part D coverage for prescription drugs. Generic medications may have a $5 copayment, while more expensive brand-name drugs may cost $10 or $15 out-of-pocket.
Two things to keep in mind when you’re considering “what is Medicare Advantage cost sharing:”
Read your plan documents carefully, especially if you choose a Medicare Advantage plan that uses a provider network. Some plans only count eligible in-network expenses toward your annual out-of-pocket maximum. If you get care outside the network, those expenses don’t contribute to your annual cap.
To begin looking at Medicare Advantage plans in your area, enter your zip code on this page and click “get started.”
*Out-of-network/non-contracted providers are under no obligation to treat Preferred Provider Organization (PPO) plan members, except in emergency situations. For a decision about whether the plan will cover out-of-network service, you or your provider are encouraged to ask for pre-service organization determination before you receive the service. Please call the plan’s customer service number or see your Evidence of Coverage for more information, including the cost-sharing that applies to out-of-network services.
**A Private Fee-for-Service plan is not Medicare Supplement insurance. Provider who do not contract with the plan are not required to see you except in an emergency.
eHealth's Medicare website is operated by eHealthInsurance Services, Inc., a licensed health insurance agency doing business as eHealth. The purpose of this site is the solicitation of insurance. Contact may be made by an insurance agent/producer or insurance company. eHealth and Medicare supplement insurance plans are not connected with or endorsed by the U.S. government or the federal Medicare program. We offer plans from a number of insurance companies.