What Is Medicare Advantage?

What is Medicare Advantage and how does it work? Read this article carefully to find out.

If you are planning to sign up for Medicare, there are several choices that you’ll have to make. The main choice, however, would be the decision to choose between Medicare Advantage or Medigap as a supplement to your Original Medicare plan.

So, what is Medicare Advantage? Otherwise called Medicare Part C or MA Plans, Medicare Advantage is an excellent option in contrast to Original Medicare. It covers a lot of things, thus proving to be an all-in-one alternative if anyone wants to switch their Original Medicare plan. Moreover, private guarantors that offer Medicare Advantage Plans contract with the national government to give health insurance benefits to individuals who meet all requirements for Medicare. Most plans offer extra benefits that aren’t covered under Original Medicare, which might incorporate dental, hearing, and vision coverage. You’ll likely have to stay with doctors within the plan’s network, yet cash-based expenses might be lower.

In 2021, almost four out of every ten people who qualified for Medicare are in Medicare Advantage Plans. Let us look at what a Medicare Advantage Plan is in more detail.

What is Medicare Advantage?

Medicare Advantage is a component of the Medicare program offered to older individuals and disabled adults who are eligible for it. They are also alluded to as Part C plans, and instead of being provided by the federal government, Medicare Advantage (MA) plans are provided by private insurance organizations. Moreover, they consist of the same Part A hospital and Part B clinical service that Original Medicare gives. However, MA plans do not provide coverage for hospice care. Most Medicare Advantage plans additionally incorporate Part D prescription drug coverage. You must remember that any individual who joins an MA plan actually has Medicare

By and large, you’ll need to utilize health care providers who take part in the plan’s network and service area for minimum expenses. These plans put down a restriction on the yearly amount you’ll need to pay from your own pocket for services that are covered. This is to shield you from startling expenses. In addition to this, a few plans offer out-of-network coverage, however, you sometimes have to pay a greater expense. Keep in mind that you should utilize the card from your Medicare Advantage Plan to get your Medicare-covered services. Moreover, keep your red, white, and blue Medicare card in a secure spot since you’ll require it if you want to revert back to Original Medicare at any given point.

Furthermore, several Medicare Advantage plans work as a health maintenance organization (HMO) or preferred provider organization (PPO) insurance. HMOs restrict members so that they can only get access to services from in-network doctors and hospitals. On the other hand, PPOs allow members to get care from outside the plan’s network. However, members might need to pay more for such out-of-network services. In addition to this, certain plans need to be approved beforehand for specialist care or treatments or a referral to a primary care physician. Remember that plans will probably not provide coverage for the care given outside of a network’s geographical region. Moreover, additional benefits that are not covered by normal Medicare, like eyeglasses, routine dental care, or gym memberships, might be provided.

How do Medicare Advantage plans work?

For the most part, Medicare is accessible to individuals who are 65 years old or more. Younger individuals with disabilities, and individuals with end-stage renal infection (permanent kidney failure requiring dialysis or transplant), or amyotrophic lateral sclerosis (ALS) can also get Medicare.

Moreover, Medicare Advantage is a sort of Medicare health plan offered by privately owned businesses that are Medicare-supported. They are viewed as an alternate option to Original Medicare and covers the total cost that arises under Medicare. In addition to this, some Medicare Advantage plans provide coverage for extra expenses that are not paid for by Medicare including vision, dental, and hearing costs. Medicare also pays the premiums for members in Medicare Advantage plans. Remember 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 premium for a Medicare Advantage plan in 2021 will decrease by almost 11%. Thus, the new premium amount would be $21 from an average of $23.63 in 2020. Privately owned businesses get a fixed sum every month for Medicare Advantage plan care. Thus, these organizations can charge policyholders with cash-based expenses and can come up with their own guidelines and rules for service, for example, the requirement for references or provider networks for both emergency services and non-urgent care.

Furthermore, regional preferred provider associations (PPOs) were set up to give rural recipients more access to Medicare Advantage plans and cover whole statewide or multi-state districts. In 2020, regional PPOs represented 5% of all Medicare Advantage enrollees. Around 24 million individuals, or 36% of those getting Medicare benefits, were enrolled in a Medicare Advantage plan in 2020. This number is expected to increase to 26 million (or more) in 2021.

Types of Medicare Advantage plans

The most widely recognized types of Medicare Advantage plans are health maintenance organization (HMO) plans, which represent most of the complete Medicare Advantage enlistments, PPO plans, private fee-for-service (PFFS) plans, and special needs plans (SNPs). The essential requirements to get one of these plans consists of living in the plan’s service region and having Medicare Parts A and B. On the other hand, medical savings account (MSA) plans are not very common.

Medicare Advantage plans have been inaccessible to individuals who have an end-stage renal disease (ESRD) except if they could discover an ESRD special needs plan in their locality. However, beginning in 2021, individuals with ESRD will be allowed to pursue any Medicare Advantage plan within their vicinity. The individuals who have ESRD should analyze the expenses of Medical Advantage plans versus Original Medicare in addition to Medigap and a Part D plan, and make sure that their primary care physicians and emergency clinic are in-network with any MA plan they are thinking about. Let us take a look at the five types of Medicare Advantage plans in more detail:

  • Health maintenance organization, or HMO, plans: HMO plans specify that you can only opt for services from in-network doctors and facilities except if it’s an emergency. In addition to this, most HMO plans require a referral to see a trained professional.
  • Preferred provider organization, or PPO, plans: PPO plans permit you to see both in-network and out-of-network health care providers. Also, PPO plans charge various rates for doctors, providers, and hospitals relying on whether they’re in-network or not. Remember that you’ll pay more for out-of-network administrations.
  • Private fee-for-service, or PFFS, plans: PFFS plans permit you to go to any Medicare-endorsed health care provider as long as they acknowledge the plan’s installment terms and consent to see you. You may likewise approach a network of providers. You can see doctors that don’t acknowledge the plan’s installment terms, however, you may pay more.
  • Special needs plans, or SNPs: SNPs are offered to specific groups of individuals who require long-term clinical consideration for chronic conditions, like cancer, or special health care needs, for example, living in a nursing home. These plans additionally give benefits to individuals who earn a limited salary.
  • Medical savings account, or MSA, plans: Consolidate a high-deductible insurance plan with a medical savings account that can be utilized for health care costs where Medicare stores cash to be utilized for clinical-related services.

What does Medicare Advantage cover?

Medicare Advantage plans offer both clinical insurance and hospital coverage and extra coverage. Contingent upon the kind of plan you pick, you additionally might be covered for:

  • Prescription drug coverage: While this isn’t typically offered as a part of Original Medicare, practically all Medicare Advantage plans offer prescription drug coverage.
  • Dental, vision, and hearing: This incorporates non-medically essential coverage, which isn’t offered under Original Medicare. Most Medicare Advantage plans vary in the amount of coverage for these alternatives.

Furthermore, a few organizations offer other health-related advantages under their Medicare Advantage plans, like gym memberships, clinical transportation, and food delivery.

What does Medicare Advantage cost?

At the point when you pursue a Medicare Advantage plan, your costs will differ from one plan to another and will depend on where you reside. A Medicare Advantage plan can come with its own monthly premium and yearly deductible, which is often added on top of the Part B premium. One benefit of a Medicare Advantage plan is that there is a yearly cap for most other out-of-pocket expenses, which might assist with bringing down your overall costs.

The complete expense of a Medicare Advantage plan is often determined by premiums, deductibles, copayments, how frequently and where you look for services, the kinds of services you need, and whether or not you get Medicaid. Keeping all these factors in mind, there is no one specific expense for a Medicare Advantage plan. These are exceedingly significant points when you compare plans.

How to enroll in a Medicare Advantage plan?

Not all Medicare Advantage Plans work in a similar manner. Before joining, make sure that you find and compare Medicare health plans in your vicinity. Once you are well aware of the plan’s rules and expenses, have done your research, and found a Medicare Advantage Plan that fits your requirements, there are different ways to enroll. You can follow the given steps to enroll in a Medicare Advantage plan:

  • Use Medicare’s Plan Finder to find the plan in your area. Click on “Enroll.”
  • Go to the plan’s website to see if you can enroll online. Get in touch with the plan provider to get a paper enrollment form. Fill it out and return it to the plan provider.
  • Call the provider for the plan you want to join.
  • Call Medicare at 1-800-MEDICARE (1-800-633-4227).

You will require your Medicare number and the date your Medicare Part A and/or Part B coverage began.

Remember that you can only sign up for a Medicare Advantage Plan during your Initial Enrollment Period (when you first become qualified for Medicare) or during the Open Enrollment Period from Oct. 15 to Dec. 7. Once you have signed up for a Medicare Advantage Plan (and have been selected for coverage), you can switch plans during Medicare Advantage Open Enrollment from Jan. 1 to March 31 each year.

Medicare Advantage vs. Medicare

Medicare Advantage Plans might have provider networks that limit your decisions. In the event that you go out of network, your care may not be covered. With Original Medicare, you can generally use any specialist, doctor, or medical facility that acknowledges Medicare tasks.

In return for less freedom, however, you frequently save money. You would in any case be needed to pay a monthly premium for Part B, however, the extra expense for a Medicare Advantage Plan might be less than for a Medigap plan. At times the Medicare Advantage Plan might have a $0 premium.

Medicare Advantage Plans may likewise have a maximum out-of-pocket limit for covered care. This covers the sum you will be expected to pay together with your premiums. Original Medicare and most Medigap plans do not have out-of-pocket maximums.

Medicare Advantage vs. Medigap

Medicare Advantage Plans are often mistaken for Medicare Supplement Insurance, otherwise called Medigap. Both are offered by private insurance organizations, however, Medigap arrangements provide coverage for individuals who purchase Original Medicare (Part A and Part B), filling gaps in Original Medicare by covering extra copays or coinsurance. Medicare Advantage Plans, on the other hand, give an alternative to Medicare Part A and Part B. You can’t have both; a Medicare Advantage Plan and a Medigap plan simultaneously. Additionally, on the grounds that Medigap policies are standardized, it is generally simple to compare costs. However, each Medicare Advantage Plan might be different, so comparison shopping can be difficult.

How to switch Medicare Advantage plans?

It’s actually smart to consider partaking in the cost savings of a Medicare Advantage plan while you’re somewhat healthy and later reverting to normal Medicare if you foster a condition that needs to be treated at a facility that is not in your city. Assuming you need to change Medicare Advantage Plans, you can do that once each year, either during Medicare’s open enrollment period (Oct. 15 to Dec. 7) or the Medicare Advantage open enrollment period (Jan. 1 to March 31).

However, here’s the tiny disadvantage. In the event that you switch back to Original Medicare (Part A and Part B), you will most likely be unable to pursue a Medigap insurance strategy on the off chance that you switch after the first year. Guarantors can only give you Medigap strategies during your first Medigap enrollment period (typically a half year after you turn 65 and sign up for Medicare Part B), or then again if you change out of your Medicare Advantage Plan in the main year. From that point onward, backup plans might deny you a Medigap strategy in the event that you have health issues, or they can require a waiting period before your prior conditions are covered.

Furthermore, a few states have sanctioned laws to address this. In New York and Connecticut, for instance, Medigap insurance plans are guaranteed-issue throughout the year, while California, Massachusetts, Maine, Missouri, and Oregon have set yearly periods in which changing your plans is permitted. If you live in a  state that doesn’t have this assurance, planning to switch between the systems relying upon your health condition might not be the best of options.

Medicare Advantage providers

Get more information about some of the major Medicare Advantage providers here:

  • Aetna 2021 Medicare Advantage plans.
  • AARP 2021 Medicare Advantage plans.
  • WellCare 2021 Medicare Advantage plans.
  • Blue Cross Blue Shield Medicare Advantage plans.
  • UnitedHealthcare 2021 Medicare Advantage plans.
  • Humana 2021 Medicare Advantage plans.

What should you consider?

While you probably won’t have a lot of Medicare Advantage choices on the off chance that you live in a rural region, metropolitan occupants could have multiple options accessible. You can narrow down the field using the following strategies:

Check out the star rating. Medicare gathers information on Medicare Advantage Plans from member reviews, surveys, and the actual plans. At that point, health care providers dole out a star rating dependent on its discoveries. The star rating goes from 1 to 5 stars, with 5 stars being the best. The rating depends on several factors such as how effective and responsive the plan is and whether customers have complained about it often or not etc.

Check the numbers. The two essential expense considerations are a plan’s premium and the maximum expense you’d have to pay from your own pocket in a year for covered health care.

Think about your prescriptions. The Medicare Plan Finder and some private comparison websites permit you to enter your standard prescriptions to assist you with deciding plan coverage and cost.

Think about the selection of doctors. Original Medicare permits you to utilize any U.S. specialist or clinic that acknowledges Medicare, and most do. Most Medicare Advantage plans limit you to utilizing in-network doctors and may cover less, or none, of the costs of utilizing out-of-network providers.

An advantage of Medicare Advantage managed care plans is that care is regulated properly and the discoveries of different specialists will be in the knowledge of your primary care physician. With customary Medicare, you needn’t bother with a referral to see a specialist or an earlier approval for treatments. However, you’ll have to ensure that care is facilitated and your PCPs are in correspondence with each other. Frequently this is best done by fostering a relationship with a primary care doctor and allowing them to introduce you to specialists.

Ponder over your preferences. On the off chance that you often visit specialists and you would prefer not to demand a reference for each office visit, a PPO plan will be a preferred alternative over an HMO. In case you’re a light health care client and frequently visit your primary care physician, an HMO may be more reasonable.

Visit the plan’s site. Before you make the final decision on a plan, go to the provider’s website and ensure you comprehend every one of the benefits — and limitations. It is important to check the plan in full detail because some of the new benefits are regularly very limited.

Call the carriers. Shoppers are encouraged to call a carrier in case they’re considering enrolling or changing to their plan.

Search for more extensive benefits. Medicare Advantage plans are changing as the public authority permits safety net providers to add coverage for things that are excluded from normal Medicare. These incorporate such things as providing nourishment for service animals; paying for ramps for wheelchairs, hold bars, and indoor air quality monitors; adult day care; and private and in-home reprieve care. A significant number of these benefits are simply being started, so it pays to reexamine your decision of normal Medicare versus Medicare Advantage every year during open enrollment to ensure that you’re getting the benefits you need most, regardless of whether it’s home consideration or transportation to specialists.

What are the advantages and disadvantages of medicare advantage plans?

Although Medicare Advantage plans look like an easy option for coverage, you should still look at the various advantages and disadvantages of Medicare Advantage:

Pros

In comparison to Original Medicare, there are some pros if you select a Medicare Advantage plan.

Convenient coverage options: Original Medicare only provides two types 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 choices are in one helpful plan.

Personalized plan structures: Medicare Advantage offers distinctive 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. In case you favor provider freedom, a PPO or PFFS plan might be ideal for you. Moreover, assuming that you need additional services like dental, vision, or hearing, numerous Medicare Advantage plans 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 costs you’ll pay from your own pocket during a plan year. Additionally, research has shown that you might get a good deal on lab services and clinical equipment by changing to a Medicare Advantage plan. Furthermore, in the event that you pick a Medicare HMO plan, you might see considerably more savings on healthcare services given by your HMO organization.

Coordinated medical care: Numerous Medicare Advantage plans incorporate coordinated clinical care. This implies that your healthcare providers effectively stay in touch to coordinate your care between various kinds of healthcare services and clinical claims to fame. This guarantees that you have a healthcare group and dodges pointless costs and issues like medication interactions. In one study, specialists tracked down that coordinated care was related to higher patient appraisals and more positive clinical staff experiences.

Cons

Although several individuals are happy with their Medicare Advantage coverage, these plans may come with some disadvantages compared to original Medicare.

Limited service providers: On the off chance that you pick one of the more mainstream Medicare Advantage plan types, for example, an HMO plan, you might have access to limited providers. You will typically confront higher expenses on the off chance that you pick an out-of-network provider with these plans. Other plan types do give you more provider opportunities. However, those plans might have higher premiums and expenses like copays and deductibles.

Complex plan offerings: Utilizing Medicare’s find-a-plan tool, you’ll see that numerous Medicare Advantage plan choices rely upon your ZIP code. For certain individuals, this load of alternatives can feel overpowering.

Additional costs for coverage: Original Medicare charges a premium, deductible, and coinsurance for Parts A and B, in addition to any Part D or Medigap costs. Medicare Advantage plans frequently merge 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. In any case, Medicare Advantage plans may just offer specific coverage in certain service areas. This implies that in the event of you moving to another service area, your present Medicare Advantage plan might be inaccessible.

Other Medicare Advantage considerations

You might benefit from a Medicare Advantage plan in case you’re hoping to get full Medicare coverage, and even some more. A Medicare Advantage plan is an extraordinary choice in case you’re keen on prescription drug coverage and yearly dental and vision arrangements. On the off chance that you have persistent health conditions, an SNP can assist with covering some long-term clinical expenses. You may likewise benefit from an MSA plan assuming you need to have assets for an assortment of clinical benefits consistently.

Notwithstanding, on the off chance that you feel that you needn’t bother with extra coverage for things like dental, vision, hearing, or prescription drugs, a Medicare Advantage plan may not be the ideal option for you. The same happens if you want to select your own providers. On the off chance that you need out-of-town coverage, a Medicare Advantage plan may not assist you with covering these clinical expenses.

Conclusion

Now that you have read this article, you know all about what is Medicare Advantage. Medicare Advantage plans offer more clinical services as compared to Medicare Parts A and B. This might incorporate extra health services, like prescription drugs, vision, dental, and more. While some Medicare Advantage plans have more cash-based expenses, others will help you save cash on long-term clinical expenses. Make sure to do proper research before making a final decision so that you make the right choice according to your needs.

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.

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