What are Medicare Advantage Plans?

Medicare Advantage Plans infographic

According to Medicare.gov, Medicare Advantage plans, also called Medicare Part C, are an “all in one alternative to Original Medicare.” Private companies approved by Medicare offer you Medicare Advantage (MA) plans. These Advantage Plans provide you with the Medicare benefits of Part A (hospital) and Part B (medical). You also have the option of joining an Advantage Plan that includes Part D prescription drugs. 

Types of Medicare Advantage (MA) Plans include:

  • Health Maintenance Organization (HMO)
  • Preferred Provider Organization (PPO)
  • Private-Fee-for-Service (PFFS)
  • Special Needs Plans (SNPs)

What is Medicare Part C?

Medicare Part C is an all-in-one alternative to Medicare hospital (Part A) and medical (Part B) coverage. You have the option to include prescription drug coverage (Part D). Furthermore, Medicare Advantage plans can provide you with extra benefits not covered by Original Medicare.

Extra Benefits

Medicare Part C Advantage Plans may provide you with the following exclusive benefits:

  • Vision
  • Dental
  • Hearing
  • Fitness program
  • Transportation

Learn more about these exclusive MA Plan benefits.

Senior man eye exam for new glasses
Medicare Part C may include vision benefits.

So what are the differences between Medicare Part C and Original Medicare? First, let’s look at your Medicare options. Then we will look at the differences.

Choosing Your Medicare Plan

You can choose to keep Original Medicare and get a stand-alone Part D drug plan and a Medicare Supplement Plan. Otherwise, you can select a Medicare Advantage (MA) Plan (Part C) with or without drug coverage. If you choose Medicare Part C, you must disenroll from MA before you can purchase a supplement plan.

To help you choose, consider the differences between Original Medicare and Advantage Plans. The chart below shows you the key differences. For example, Original Medicare is nationwide. In comparison, Medicare Advantage Plans may require you to use the hospitals and doctors in their network. HMOs may have little or no premiums. However, you will need to get referrals to see specialists.

Choosing Your Medicare Plan seniors at chess board
Two seniors consider their Medicare options.

Medicare Advantage vs Medicare

Medicare 2021 Chart - Advantage vs Original differences

Compare Medicare Advantage and Medicare

Group of Seniors consider Medicare Plans
Group of seniors discuss Medicare differences.

The 2021 chart above compares the differences between Original Medicare and Medicare Advantage Plans. Starting in 2021, anyone with ESRD can join Medicare Advantage Plan. Original Medicare has no medical insurance underwriting when you apply during your Initial Enrollment Period. First, let’s look at how the costs differ between Medicare and Medicare Advantage. 

Original Medicare Costs

With Original Medicare, you typically pay 20% coinsurance. Furthermore, whenever you get a diagnostic test or have a hospital or ER visit, you may have copayments. Generally, you pay Medicare Part B monthly premiums. unless you have Medigap plan C or F. Moreover, you may also have Part D drug premiums. Original Medicare has no maximum out-of-pocket limit, unless you have Medigap Plans K or L.

Medicare Advantage Costs

Medicare Advantage (MA) Plans have fixed copayments for doctor visits and medical services. MA plans do not have coinsurance. However, you may pay Part B and MA plan premiums, which may include drug coverage. Your maximum out-of-pocket limit in 2021 is $7,550 or less. 

Original Medicare does not cover prescription drugs.

Learn more about the differences between Advantage vs. Original Medicare. Next, let’s look at the differences between Medicare Advantage and Medigap Plans.

Medicare Advantage vs Supplement Plans

Medicare 2021 Chart - Advantage vs Supplement infographic
Female Doctor speaking with senior woman
Female doctor speaks with a senior woman.

The Medicare 2021 chart show differences between Medicare Advantage and Supplement (Medigap) Plans. Similar to Original Medicare, Medigap Plans have no medical insurance underwriting if you apply during your Medigap Open Enrollment Period. Otherwise, you will have to answer questions about your medical condition, and supplement companies could deny you coverage.

Let’s consider the cost differences between Advantage and Supplement plans.

Cost Differences of Advantage vs Supplement

In addition to the copayments already mentioned, Advantage Plans may have lower monthly premiums than Medigap Plans. Many Advantage Plans cover prescription drugs. However, Supplement Plans do not. Therefore, you will need to pay premiums on a separate Part D drug plan.

Discover more Medigap Plan differences, such as:

  • Copays for Supplement Plans K, L, and N
  • Low 2021 Advantage Plan premiums
  • Maximum out-of-pocket limits on plans K and L
Medicare Part D prescription drug costs pills and hunred dollar bills
Medicare Supplements do not cover prescription drugs.

Your Medicare Advantage Plan Card

New Medicare Card
Sample Original Medicare Card
Medicare Advantage Plan Card
Sample Medicare Advantage Card

When you choose a Medicare Advantage (MA) plan, a private company provides you with health insurance. After you have signed up for Medicare Parts A and B, you will receive your Original Medicare Card. This card will be different than your Medicare Advantage Card.

When you join a MA plan, most of your Part A and Part B coverage comes from your MA plan, not Orignal Medicare.

Paying for Your Health Benefits

In most cases, you want health care providers to send bills to your Medicare Advantage company. Thus, please present your Medicare Advantage Plan card (not your Original Medicare card) to your healthcare provider. You may need your Original Medicare card for services not covered by MA. Please file your red, white, and blue card in a safe place.

Medicare Advantage (MA) Plans

In most Medicare Health Maintenance Organization (HMO) plans, you receive care and services from doctors, hospitals, and other healthcare providers in your plan’s network. However, you can get out-of-network coverage for emergency care, urgent care, and dialysis. You will need to select a primary care physician. That physician will coordinate referrals if you need to see specialists. 

Medicare Preferred Provider Organization (PPO) plans allow you to see doctors outside the network. However, you will have substantially higher out-of-pocket spending to do so. In other words, PPO plans give you the flexibility to go to doctors, specialists, or hospitals that are not on the plan list, but it will usually cost more. In most cases, HMO and PPO plans cover prescription drugs.

Medicare Private Fee-For-Service (PFFS) plans are less common and available in limited counties. Moreover, PFFS plans may or may not include drug coverage. Like PPO, PFFS plans allow you to choose out-of-network doctors, hospitals, or other providers. However, your cost will usually be lower if you stay in-network. 

When choosing a Medicare Advantage network, make sure all of your providers and suppliers are in the network (not just doctors). For instance, if you have durable medical equipment or a home health care provider, please make sure they are in your network.

Medicare Advantage Network
Medicare Advantage has plans like HMO and PPO that provide you with a network of healthcare benefits.
Senior man pays for prescription drugs at pharmacy
Most HMO and PPO plans cover your prescription drugs.

Special Needs Plans (SNP)

Medicare Special Needs Plans (SNP) limit membership to people with specific diseases or characteristics. SNPs tailor their benefits, provider choices, and drugs to best meet the particular needs of the groups they serve. Most often, you get care and services from doctors or hospitals in the Medicare SNP network. 

However, you can receive out-of-network care for emergency or urgent care for a sudden illness or injury. Likewise, you can receive out-of-area dialysis if you have End-Stage Renal Disease (ESRD). 

All SNPs provide prescription drug coverage. In most cases, SNPs may require you to have a primary care doctor. Otherwise, the plan may need you to have a care coordinator to help with your health care. 

If you need to see a specialist, you may need a referral. However, you do not need a referral for annual mammogram screening or in-network pap tests and pelvic exams.

According to Medicare.gov, to join a Special Needs Plan, you must have one or more of the following chronic conditions:

  • Chronic alcohol and other dependence
  • Autoimmune disorders
  • Cancer (not pre-cancer conditions)
  • Cardiovascular disorders
  • Chronic heart failure
  • Dementia
  • Diabetes mellitus
  • End-stage liver disease
  • End-stage Renal Disease requiring dialysis
  • Severe hematologic disorders
  • Chronic lung disorders
  • Chronic and disabling mental health conditions
  • Neurologic disorders
  • Stroke

Enroll in Medicare Advantage Plan

To enroll in a Medicare Advantage Plan, you must first enroll in Medicare Part A and Part B. Consequently, you may still pay Medicare Part B monthly premiums. You can enroll in an Advantage Plan during these times:

  • Initial Enrollment Period when you first turn 65
  • Annual Election Period October 15 – December 7

Annual Election Period

During the Annual Election Period (AEP), you also have the following options:

  • Enroll in an Advantage Plan
  • Change to a different Advantage Plan
  • Drop your Advantage Plan and return to Original Medicare

Discover other Medicare Plan changes you can make during AEP.

Medicare Advantage Open Enrollment

During Medicare Advantage Open Enrollment, you have two options:

  • Switch from one Advantage Plan to a different Advantage Plan
  • Disenroll from your Advantage Plan and return to Original Medicare and join a Part D drug plan
Senior couple overweight walking in woods
A senior couple walks in the woods
Aftican American Couple overweight with bicycles
Active senior couple on bicycles in a park.

What Medicare Advantage Does Not Cover

Medicare Advantage plans do not cover the following:

  • Some new Medicare benefits
  • Hospice care
  • Some costs for Clinical research studies

Thus, please use your Original Medicare red, white, and blue card for the above services. Each MA plan is different. Please read your plan rules for details.

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