Medicare Part C (Medicare Advantage
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 your personal preferences and lifestyle. Let’s take a closer look at some of the important pros and cons of Medicare Advantage plans.
Pros
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.
Often a Medicare Advantage plan can be less expensive than comparable coverage you would receive if you stay 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. An example would be the Health Maintenance Organization (HMO) Medicare Advantage plans. These HMO plans require you to select a Primary Care Physician (PCP) who helps 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
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 a 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 often plans 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 six 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 requires following the Medicare Advantage plan’s rules to receive payment for covered services.
Medicare Advantage Plan Enrollment
There are generally four periods in which you can enroll in a Medicare Advantage plan or switch plans.
Initial Enrollment Period
For most people, the first time to sign up for Medicare Advantage is turning 65. This time is the Initial Enrollment Period, and it runs seven months, starting three months before the month you turn age 65, the month you become age 65, and ending three months after your birthday month.
You generally may enroll in a Medicare Advantage plan during your Initial Enrollment Period as long as you do not have End-Stage Renal Disease (ESRD). You will need to select a Medicare Advantage plan where you live. (Generally, people with ESRD receive their hospital and medical insurance from the government’s Original Medicare program.)
If you become eligible for Medicare under age 65 because of disability, you will receive a letter from Social Security saying when your Medicare coverage will begin. Social Security will automatically enroll you in Medicare Part A and Part B. Your Medicare coverage typically starts 24 months after your disability benefits were approved. Usually, you will be able to enroll in a Medicare Advantage plan at this time. When you turn age 65, you’ll be entitled to a second seven-month Initial Enrollment Period — this time based on your age instead of disability. You get to start over and choose to enroll in a Medicare Advantage plan available where you live.
Annual Enrollment Period
October 15 through December 7
Each year during the Annual Enrollment Period, you have the opportunity to review your existing Medicare coverage and, if you desire, change to a different Medicare Advantage plan offered by a Medicare-approved private insurer or switch to the government-administered Medicare Part A and Part B program. You can use the Annual Enrollment Period to:
Change your coverage from the government-administered Medicare Part A and Part B program to a Medicare Advantage plan. Or switch from a Medicare Advantage plan to the government-administered Medicare program.
Change from one Medicare Advantage plan to another.
Enroll in a standalone Medicare Part D Prescription Drug Plan if you change from a Medicare Advantage Prescription Drug plan to the government-administered Medicare Part A and Part B program.
Open Enrollment Period
January 1 through March 31
If you’re enrolled in a Medicare Advantage plan, you can change Medicare Advantage plans during this time. Or, you can switch back to Medicare Part A and Part B and replace your Medicare Advantage prescription drug coverage with a standalone Medicare Part D Prescription Drug Plan.
Special Enrollment Period
Usually, you can enroll in a Medicare Advantage plan (or change Medicare Advantage plans) under special circumstances that involve changes resulting from life events or a loss of insurance coverage. Listed below are some of the common circumstances that can trigger a Special Enrollment Period.
Permanent relocation. If you are enrolled in a Medicare Advantage plan, and you move outside the plan’s service area, you are eligible to enroll in another Medicare Advantage plan where you live or return to the government-administered Medicare Part A and Part B.
Enroll in a five-star Medicare Advantage plan. If you are currently enrolled in a Medicare Advantage plan, generally, you can change to a five-star Medicare Advantage plan that serves the area where you live from December 8 through November 30. But you can only use this Special Enrollment Period once during the time frame.
Low Income. If you are dually enrolled in a Medicare Advantage plan and Medicaid, you may be able to enroll, disenroll, or switch to another Medicare Advantage plan once per quarter during the first three quarters of the year.
Long-term care residency. If you reside in a nursing home, skilled nursing facility, rehabilitation facility, or another long-term facility, you may be eligible to enroll in a Medicare Advantage plan or change Medicare Advantage plans as frequently as once a month (although this frequency is not recommended).
Loss of insurance coverage through no fault. If you are eligible for Medicare and deferred enrolling in Medicare Part B because you had insurance coverage through an employer or union-sponsored group health plan, you may be able to enroll in a Medicare Advantage plan when you sign-up for Medicare Part B.