What Is A Medicare Advantage Plan?

What is a Medicare Advantage plan and what does it cover? Read this article thoroughly to find out.

Also known as “Part C” or “MA Plans,” Medicare Advantage plans are an “across the board” option in contrast to Original Medicare. They are offered by private organizations endorsed by Medicare. In the event that you join a Medicare Advantage Plan, you actually have Medicare. These “bundled” plans incorporate Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance), and typically Medicare drug coverage (Part D).

Moreover, everything under original Medicare is incorporated with a Medicare Advantage plan, like hospital and medical insurance. Notwithstanding, most Medicare Advantage plans likewise cover extra health-related services, like prescription drugs, vision, and dental. While some Medicare Advantage plans offer long-term savings, plan adaptability, and better consideration, others can prompt fewer supplier alternatives, extra expenses, and challenges in one’s way of life.

If you want to know more about what is a Medicare Advantage plan, then you have come to the right place. We have gathered all relevant information to help you understand everything that you need to know. So, what are you waiting for? Without much further ado, let us jump right in!

What is a Medicare Advantage plan?

Medicare Advantage is essential for the Medicare program offered to older individuals and other eligible adults who have a disability. Likewise alluded to as Part C plans, Medicare Advantage (MA) plans are given by private insurance organizations rather than the national government. In addition to this, the Medicare Advantage program (Part C) gives individuals a substitute method of accepting their Medicare benefits. The program comprises various healthcare plans (commonly HMOs and PPOs) that are controlled by Medicare but managed by private insurance organizations. Furthermore, plans typically charge month-to-month expenses (notwithstanding the Part B premium), albeit a few plans in certain areas are premium-free.

Moreover, Medicare Advantage plans incorporate a similar Part A hospital and Part B medical coverage that Original Medicare gives. However, it does not provide coverage for hospice care. Most MA plans additionally incorporate Part D prescription drug coverage. You must remember that any individual who joins a MA plan actually has Medicare. A few plans offer additional advantages that are excluded from Original Medicare, like coverage for routine hearing, vision, and dental consideration, and fitness schedules.

In contrast to the original program, Medicare Advantage plans function in limited areas. HMOs normally expect you to visit in-network doctors and hospitals unless you are in a crisis. On the other hand, PPOs permit you to visit doctors and specialists outside of the plan’s provider network for higher copays. Therefore, Medicare Advantage plans are not fit for individuals who live in more than one state during the year or travel frequently.

Medicare Advantage plans can change their expenses (premiums, deductibles, copays) each scheduled year. To ensure that you get the best out of your arrangement, you can analyze plans in your area during the Open Enrollment time frame (Oct. 15 to Dec. 7), and assuming that you need it, you can change to another plan for the next year.

To join a Medicare Advantage plan, you should be enrolled in Medicare Part A and Part B. The arrangement can’t decline your application, paying little heed to your health needs, except for one situation: You can’t join an arrangement on the off chance that you have permanent kidney failure (an end-stage renal disease that requires ordinary dialysis or a kidney transplant). However, you can, in any case, get medical consideration for this condition through the Original Medicare program. Medicare Advantage plans can’t charge you higher premiums, deductibles, or copays based on your present health status or prior medical conditions.

You must note that Medicare supplemental insurance (Medigap) doesn’t work with Medicare Advantage plans, and in this way, you will have to pay any cash-based costs (copays, deductibles) yourself.

How do Medicare Advantage plans work?

Medicare is by and large accessible for individuals who are 65 years old or more, young individuals with disabilities, and individuals with an end-stage renal disease — permanent kidney failure requiring dialysis or transplant — or amyotrophic lateral sclerosis (ALS). Medicare Advantage is a kind of wellbeing plan offered by private organizations that are backed by Medicare. They are viewed as an option in contrast to Original Medicare and cover every one of the costs incurred under Medicare.

In addition to this, some Medicare Advantage plans cover extra expenses that are not paid for by Medicare. These include vision, dental, and hearing costs. Medicare pays the charges for members in Medicare Advantage plans. Moreover, keep in mind that Medicare Advantage plans don’t work with Medigap, which is additionally called Medicare Supplement Insurance.

It is expected that the average month-to-month expense for a Medicare Advantage plan in 2021 will drop by almost 11% to about $21 from an average of $23.63 in 2020. Furthermore, private organizations get a proper sum every month for Medicare Advantage plan care. Thus, these organizations can charge cash-based expenses for policyholders and can build up their own guidelines for administration. For example, the requirement for references or supplier networks for both emergency services and non-critical care.

Regional preferred provider organizations (PPOs) were set up to give rural recipients more noteworthy admittance to Medicare Advantage plans and cover whole statewide or multi-state districts. Regional PPOs represented 5% of all Medicare Advantage enrollees in 2020. Around 24 million individuals, or 36% of those getting Medicare benefits, were signed up for a Medicare Advantage plan in 2020. It is predicted that this number will increase to more than 26 million in 2021.

Types of Medicare Advantage plans

Medicare Advantage, otherwise called Medicare Part C, is a kind of insurance plan that offers fundamental Medicare coverage alongside extra advantages. Medicare Advantage is sold by private insurance organizations that have an agreement with Medicare. There are different types of Medicare Advantage plans to opt for contingent upon your needs. They include:

  • Health Maintenance Organization (HMO). HMO plans specify that you can just look for services from doctors and hospitals that are in-network. Moreover, specialists need out-of-network referrals.
  • Preferred Provider Organization (PPO). PPO plans charge various rates for specialists, providers, and hospitals relying upon whether they’re in-network or not. Remember that you’ll pay more for out-of-network services.
  • Private Fee-for-Service (PFFS). PFFS plans permit you to get services from any provider as long as they acknowledge the installment agreements of your PFFS plan.
  • Special Needs Plans (SNPs). SNPs are offered to specific groups of individuals who require long-term medical care for chronic conditions.
  • Medicare savings account (MSA). MSA plans consolidate a high deductible health plan with a medical savings account where Medicare stores cash to be utilized for medical-related services.

You fit the bill for Medicare Advantage whenever you have signed up for Medicare Part A and Part B.

How much does a Medicare Advantage plan cost?

An individual who has signed up for Medicare Advantage should pay month-to-month Medicare Part B charges notwithstanding expenses for their Advantage plan. Although this number might change on the basis of your salary, month-to-month Part B premiums in 2021 are $148.50. For example, a few people with government-backed retirement advantages might pay somewhat less, and some Medicare Advantage plans either pay all or a fraction of the Part B expenses. The average premium for a Medicare Advantage plan in 2020 was $25 each month. Albeit this is the average, some premiums cost $0, and others cost above and beyond $100.

Besides month-to-month charges, the expenses of Advantage plans consist of deductibles and cost-sharing in the form of copayments or coinsurance. The sum you need to pay changes from one state to another and also depends on the type of arrangement you have. Different components that influence Medicare Advantage costs are:

  • whether an individual’s plan provides extra benefits, which involve higher premiums
  • the scope and frequency of healthcare services that an individual needs
  • whether a person goes to an in-network or out-of-network provider
  • whether a person goes to a healthcare provider that accepts Medicare

Medicare Advantage plan providers set a yearly limit for costs, implying that an individual doesn’t need to pay for any costs that surpass the cap. In 2021, the cap for cash-based expenses in Medicare Advantage plans was $7,550. This sum is the limit for plans that exclude prescription drug coverage. Be that as it may, this is the maximum limit, and many plans have lower caps.

In addition to this, for individuals getting social security retirement benefits, Medicare Part B expenses will emerge from their month-to-month check. Moreover, the individuals who don’t get advantages might pay their expenses after every three months via a check, credit card, or automatic debit from a checking account. An individual pays their Advantage plan premium to the private organization that gives it. Furthermore, although techniques for installment fluctuate among providers, they frequently incorporate checks, credit cards, and programmed debit.

How to get lower costs?

Not every person can afford to pay Medicare expenses, including those for Medicare Advantage. Individuals with restricted salaries might get assistance with installments on the off chance that they meet all requirements for Medicare Savings Programs (MSPs) or Medicaid.

Medicare Savings Programs

An individual might apply for MSPs in the event that they have or are qualified for Medicare Part A. Their salary should be below a certain point, together with limited assets such as bonds, stocks, and cash in a bank account. The four types of MSPs include:

Qualified Medicare Beneficiary Program: The month-to-month income limit to sign up is $1,084 for an individual and $1,457 for a wedded couple. This program helps pay for charges for Part A and B, alongside copayments, coinsurance, and deductibles.

Specified Low-Income Medicare Beneficiary Program: The month-to-month income limit to sign up is $1,296 for an individual and $1,744 for a wedded couple. This state program provides assistance in paying for Part B for individuals with Part A.

Qualifying Individual Program: The month-to-month income limit is $1,456 for an individual and $1,960 for a wedded couple. This state program additionally provides assistance to pay for Part B for individuals with Part A.

Qualified Disabled and Working Individuals Program: The month-to-month income limit is $4,339 for an individual and $5,833 for a wedded couple. This program assists a working individual with a disability to pay for Part A charges.

Medicare might change the expenses for each arrangement on a yearly basis.

Medicaid

Medicaid is an elective program that gives assistance with healthcare costs. A few states call the program Medi-Cal or Medical Assistance. Medicaid is a joint government and state program for individuals with a low income and restricted assets. It might give coverage for services that Medicare doesn’t completely cover, like individual care, community services, and transportation to healthcare offices. Furthermore, income and asset prerequisites to sign up for Medicaid vary from one state to another.

What do Medicare Advantage plans cover?

Medicare Part C plans, otherwise called Medicare Advantage, are sold by private insurance organizations. They consolidate original (Medicare Part A and Medicare Part B) coverage and typically offer extra advantages. Medicare Advantage plans offer both hospital and clinical insurance coverage and extra coverage. Contingent upon the sort of plan you opt for, you additionally might be covered for:

  • Prescription drug coverage. Although this coverage is not typically provided by Original Medicare, almost all Medicare Advantage plans offer prescription drug coverage.
  • Dental, vision, and hearing. This includes non-medically necessary coverage, which is not provided by Original Medicare. Most Medicare Advantage plans differ in the amount of coverage for these alternatives.

What’s more is that a few organizations offer other health-related advantages under their Medicare Advantage plans, like gym memberships, clinical transportation, and food delivery. Numerous Medicare Advantage plans also offer the accompanying advantages:

  • hospitalization
  • some home healthcare services
  • hospice care
  • doctor’s visits
  • prescription drug coverage
  • preventive care
  • dental
  • vision
  • hearing
  • SilverSneakers fitness memberships

Who is eligible for Medicare Advantage?

An individual qualified for benefits under Part A and signed up in Part B is qualified for a MA plan. An individual is qualified to try out a specific MA plan if the plan provides service in the region where the individual lives. In addition to this, a Medicare Advantage plan can not deny enrollment to a qualified individual dependent on health status or other certain components.

In any case, people with end-stage renal disease (ESRD) are for the most part excluded. However, there are a few exceptions, including when a person who is diagnosed with ESRD while being enrolled in an MA plan can still remain enrolled for the plan. This individual may likewise sign up for another MA plan in case the person’s original plan ends its agreement with CMS or lowers its service area. Nonetheless, a person with ESRD may choose a Medicare Advantage special needs plan as long as that plan has chosen to enlist ESRD people. Moreover, there are also a few situations where an MA plan might acknowledge enrollees with ESRD who are signing up through a business or union bunch.

How to join a Medicare Advantage plan?

To sign up for a Medicare Advantage plan, an individual should finish and sign an election form or complete another CMS-supported election method provided by the MA organization. In addition to this, people can also directly contact their plan or call 1-800-MEDICARE to sign up. Moreover, Medicare Advantage organizations should at least have a paper enrollment form procedure that potential enrollees can easily access.

Medicare Advantage enrollment periods

Most individuals are just allowed to join or leave a Medicare Advantage plan on specific occasions during the year. This is alluded to as the “lock-in” rule. If you are planning to sign up for Medicare Advantage, remember that there are a couple of election periods during which an enrollment request can be made.

The Initial Coverage Election Period (ICEP), is the period during which an individual who has recently qualified for Medicare Advantage might settle on their initial decision to take on a MA plan. This period starts three months preceding the individual’s first entitlement to both Medicare Part A and Part B and ends on the later of either the last day of the month before qualification to both Part A and Part B or, the last day of the individual’s Part B initial enrollment period.

During the Annual Coordinated Election Period (ACEP) all MA eligible individuals might choose among every single accessible choice, ranging from Original Medicare, MA plans, MA-PD plans, or Prescription Drug Plans (PDPs). The ACEP starts from October 15 through December 7 each year; coverage starts on the primary day of the accompanying calendar year. The Annual Enrollment Period for Part D mirrors that of the ACEP for MA.

Open Enrollment Period for Institutionalized Individuals (OEPI): MA eligible individuals, who move into, live in, or move out of a nursing home or other establishment, as characterized by the Centers for Medicare and Medicaid Services (CMS), can make a limitless number of MA elections.

The Medicare Advantage Disenrollment Period (MADP) offers an MA plan enrollee the chance to disenroll from any Medicare Advantage plan and return to Original Medicare between January 1 and February 14 each year. Disenrollment is compelling on the first of the next month. The MADP doesn’t give a chance to join or switch MA plans, yet it permits somebody leaving a MA plan to get Part D prescription drug coverage.

During a Special Enrollment Period (SEP) an individual might choose a plan or change their present plan election. There are various SEPs, including those for individuals whose current plan ends, disregards an arrangement of its agreement, or distorts the plan’s arrangements; individuals who change home; and individuals who meet “exceptional conditions” as the Medicare program might give. Note that CMS has assigned an SEP for those individuals who are eligible for Medicare and full Medicaid (dual eligibles) and for those eligible for “Medicare Savings Programs.” These individuals can make an MA change or return to traditional Medicare consistently.

Medicare Advantage eligible individuals who choose an MA plan during the initial enrollment period somewhere around their 65th birthday celebration have an SEP, known as SEP65. SEP65 permits the individual to disenroll from an MA plan and choose conventional Medicare any time during the year-long period that starts on the viable date of coverage in the MA plan. There is additionally an SEP to permit Medicare recipients eligible for a MA plan to join up with a 5-star MA plan anytime during the year.

What are the advantages and disadvantages of Medicare Advantage plans?

Advantages of Medicare Advantage

Compared to original Medicare, there are some pros of selecting a Medicare Advantage plan. Let us have a look:

Convenient coverage options: Original Medicare only offers two sorts of coverage: hospital insurance and medical insurance. Assuming you need extra coverage, you’ll need to buy Medicare Part D for prescription drug coverage and Medigap for supplemental coverage. With a Medicare Advantage plan, all your coverage alternatives are in one advantageous plan.

Personalized plan structures: Medicare Advantage offers diverse plan types according to your circumstances. For instance, on the off chance that you have an ongoing health condition, an SNP Advantage plan can assist with your clinical expenses. On the off chance that you prefer provider freedom, a PPO or PFFS plan might be an ideal option for you. Assuming that you need additional administrations like dental, vision, or hearing, numerous Medicare Advantage plans will incorporate them.

Cost-saving opportunities: Many Advantage plans have no premiums and offer low or no deductibles. Another advantage of picking Medicare Advantage is that most plans put down certain restrictions on the maximum cash-based costs you’ll pay during a plan year. Additionally, research has shown that you might get a good deal on lab administrations and clinical gear by changing to a Medicare Advantage plan. On the off chance that you pick a Medicare HMO plan, you might see considerably more investment funds on healthcare administrations given by your HMO network.

Coordinated medical care: Numerous Medicare Advantage plans incorporate coordinated clinical care. This implies that your healthcare providers effectively communicate to facilitate your care between various kinds of healthcare administrations and clinical specialties. This guarantees that you have a healthcare group and assists you in keeping away from pointless costs and issues like medicine interactions. In one investigation, analysts tracked down that coordinated care was related to higher patient appraisals and better clinical staff experiences.

Disadvantages of Medicare Advantage

Although many individuals are happy with their Medicare Advantage coverage, these plans may also have some cons. Let us have a look at some disadvantages of Medicare Advantage plans:

Limited service providers: On the off chance that you pick one of the more well-known Medicare Advantage plan types, for example, an HMO plan, you might be restricted in the providers you can see. You will typically confront higher charges on the off chance that you pick an out-of-network provider with these plans. Moreover, other plan types do give you more provider freedom. However, those plans might have higher premiums and expenses like copays and deductibles.

Complex plan offerings: Utilizing Medicare’s find-a-plan toll, you’ll see that there are numerous Medicare Advantage plan alternatives depending on your ZIP code. For certain individuals, this plethora of choices can be a little overwhelming.

Additional costs for coverage: Original Medicare charges a premium, deductible, and coinsurance for the two sections A and B, in addition to any Part D or Medigap costs. Medicare Advantage plans frequently combine these expenses, however, you might see extra charges. For instance, numerous Medicare Advantage plans incorporate drug deductibles and specialist visit copays.

State-specific coverage: Original Medicare offers similar coverage across the United States. Notwithstanding, Medicare Advantage plans may just offer specific coverage in some service areas. This implies that in the event that you move to another service area, your present Medicare Advantage plan might be inaccessible.

Conclusion

Now that you have read this article, you know all about what is a Medicare Advantage plan. Medicare Advantage plans offer more medical coverage than what your standard Medicare parts A and B can offer. This might incorporate extra health services, like prescription drugs, vision, dental, and a lot more. In addition to this, Medicare Advantage offers many advantages to original Medicare, including several plan alternatives, long-term savings, and convenient coverage.

While some Medicare Advantage plans have more cash-based expenses, others will help you save money on lasting medical expenses. Remember that every person does not need a Medicare Advantage plan, so you must think about your medical and monetary requirements before deciding what kind of Medicare is best for you.

Furthermore, there are a few disadvantages of Medicare Advantage plans too, including supplier constraints, extra expenses, and absence of coverage while traveling. Regardless of whether you pick original Medicare or Medicare Advantage, you must audit medical care needs and Medicare choices before you select your coverage.

Charles Bains

Charles Bains

Charles Bains started his insurance career as a marketing intern before pounding the pavement as a commercial lines agent in Orlando, FL. As an industry journalist, his articles have appeared in a variety of trade publications. His insurance television career, short-lived but glorious, once saw him serve as the expert adviser on an insurance-themed infomercial (yes, you read that correctly). Having recently worked for various organizations, coupled with his broader insurance knowledge, Charles is able to understand our client’s needs and guide them accordingly. He is a gem for Insurance Noon as his wide area of expertise and experience have been beneficial in conducting further researches to come up with solutions and writing them in a manner which is easy for everyone including beginners to comprehend.