Medicare Advantage Plans Guide
One of the most important decisions Medicare beneficiaries make is choosing between Original Medicare (traditional Medicare) and Medicare Advantage. This choice is the first fork in the road, and the route you choose will determine which options you’ll have for everything from prescription drug coverage to which doctors you can see.
But this split down the center of Medicare is a little misleading because all Medicare Advantage plans include, at a minimum, everything Original Medicare covers. The main differences are how enrollees receive coverage, who provides it, and how often they should expect changes.
What Advantage plans could include:
With thousands of Medicare Advantage plans available, choosing the right one can be challenging. Let’s look at how to compare them.
Medicare Advantage plans: how to choose
No matter how well your spouse’s, brother’s, or friend’s plans work for them, your health care needs are unique. Getting the best coverage at the best price means forging your own path through the Medicare Advantage market.
The easiest way to do that is to use our Suggest-a-Plan tool to create a short list of plans we think may provide the best coverage for you. When you’re choosing between them, consider prescription drug coverage, cost, provider networks, and quality.
Prescription drug coverage under Medicare Advantage
Prescription drug coverage can vary widely throughout Medicare Advantage, also known as Part C, and it’s one of the most important considerations for finding the right plan.
Original Medicare beneficiaries typically get their medications with help from a stand-alone Medicare Part D prescription drug plan, but in most cases, Medicare Advantage beneficiaries can’t enroll in Part D. The exceptions are Medicare Private Fee-For-Service (PFFS) plans and Medical Savings Account (MSA) plans that don’t provide their own prescription drug coverage, but these are relatively rare.1
Medicare Advantage companies that offer creditable coverage (that is, coverage as good or better than a stand-alone Part D plan) must cover specific categories of drugs. Within those categories, however, companies can vary which particular drugs they pay for and whether the plan covers both generics and brand-name medications.
Whether a plan covers the specific medications you take (and those you’re likely to take in the future) should be an important part of your decision.
When it comes to out-of-pocket costs, Medicare Advantage plans vary widely. Insurance companies must offer coverage that’s at least as good as Original Medicare, but they have more freedom when deciding what to charge.
In other words, your deductibles, copayments, and coinsurance will all be the same or better than what you’d see in Original Medicare, but your premiums could be higher. That said, insurance companies have one compelling reason to keep premiums low: you.
The Medicare program gives Medicare Advantage companies a cash amount for every person enrolled in a plan with them. This amount stays the same no matter how much you use your insurance, so the more people in a plan, the more money the plan brings in.
In locations where many companies offer similar coverage, they offer low premiums to compete for more beneficiaries. If you’re willing to shop around (or let us do that legwork for you), you could see huge savings.
When you’re considering Medicare Advantage plans, find out which providers are in the network so you don’t have to go far out of your way to see a doctor or pick up prescriptions.
Many Medicare Advantage plans, such as Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), Special Needs Plans (SNPs), and even some Private Fee-For-Service (PFFS) plans, offer networks of providers that have already agreed to accept the plan’s insurance. Depending on your policy, your insurance may only cover services from these providers or pay less toward out-of-network services.
If staying with your current doctor, pharmacists, and other health care providers is important to you, this will limit your plan choices.
The Medicare program uses Star Ratings to rate all Medicare Advantage plans from one to five stars, based on how well they serve their beneficiaries. The ratings consider quality of both preventative and chronic condition care, member satisfaction, and how the plan handles customer service.
CMS assigns one star to indicate poorly performing plans at one end and five stars to excellently performing plans at the other. In some cases, the Center for Medicare and Medicaid (CMS) makes it easier to enroll in five-star plans outside of established enrollment periods.
MedicareHealthPlans also publishes reviews of Medicare plans, companies, and types of coverage on our blog. We consider pricing, customer service, accuracy, and other factors.
So, what will your Medicare Advantage plan look like?
Here are a few changes new to the program in 2019
Each year, the Centers for Medicare and Medicaid (CMS) updates the Medicare Program. Check out the Medicare Advantage Plan Changes in 2018 to see what tweaks they made last year.
This year, CMS is making it a bit easier to enroll in Medicare Advantage plans in 2019. CMS has also updated costs such as premiums, deductibles, and more.
New 2019 Medicare Advantage enrollment period
There will be a new MA enrollment period from January 1 to March 31, during which you can switch between MA plans, return to Original Medicare, and add or drop a Part D plan if applicable.2 This new period will replace the shorter Medical Advantage Disenrollment Period, which beneficiaries could use to return to Original Medicare.
Medicare Advantage plans 2019
In 2019, there are over 3,700 Medicare Advantage plans in the United States. Each must meet federal regulations for coverage, which includes these updated costs:3
- Standard Part A premium: (if applicable): $437
- Standard Part B premium: $135.50
- Hospital deductible: $1,364
- Medical deductible: $185
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What is Medicare Advantage?
Medicare Advantage (MA) plans are provided by private insurance companies as an alternative to Original Medicare. Unlike Original Medicare (which offers the same, uniform coverage to every enrollee), Medicare Advantage, also called Part C, consists of many different plans that vary in cost, region, and coverage.
Medicare Advantage Plans come in different forms, such as PPOs and HMOs, which you might recognize from health insurance you’ve had through an employer. While plans may look similar, there are some key differences.
First, every Medicare Part C plan meets government requirements for minimum coverage. Many companies also add extra coverage that varies by plan and location, but many of the following features are common:
Because plans vary so widely, premiums do too, and not all plans are available in every area.
Finally, just as the government adjusts Original Medicare each year, Medicare Advantage providers can (and often do) change what their plans offer and cost annually. They can even make some changes, such as which prescription drugs they cover, throughout the year.
If your 2018 Medicare Advantage plan will change in 2019, the company will send you an Annual Notice of Change (ANOC). Even if you don’t get one of these in the mail, we recommend shopping around during Open Enrollment (October 15 to December 7) in case a better plan hits the market.
Am I eligible for Medicare Advantage?
The rules for who’s eligible for Medicare Advantage nearly match those for Original Medicare, such as being at least 65 years old or having a qualifying disability and being a US Citizen or a permanent legal resident for five years.4 But there are a few exceptions.
You must have Original Medicare already
To enroll in Medicare Advantage, you have to have both Part A and Part B of Original Medicare. You can join a Part C plan immediately during your Initial Enrollment Period or stick with Original Medicare until Open Enrollment and switch to Part C then. (We go into this in more detail in “How to enroll in Medicare” below.)
You (probably) can’t have ESRD
In most cases, if you have end-stage renal disease (ESRD) which requires dialysis or a kidney transplant, you won’t be able to enroll in Medicare Advantage, although this may change by 2021.5
There are a few exceptions to this rule:
- Some types of Medicare Advantage plans are specifically designed to provide coverage to people with ESRD.
- If you’re already enrolled in Medicare Advantage when diagnosed with ESRD, you can keep your current coverage, but you won’t be able to switch to another Part C plan except in special circumstances.
- If you have employer-provided coverage with an insurance company offering a Medicare Advantage Plan, you can enroll in that MA plan.
You have to live in a covered service area
Private MA plans are not required to be available in all areas. In fact, most are regional or provide coverage for just a few ZIP codes. If you live in a rural area, fewer plans may be available to you.
You may even find yourself in an area with no Medicare Advantage plans at all. In this case, you would need to stick with Original Medicare.
Will you have access to a Medicare Advantage plan where you live? Probably. In 2019, 99% of Medicare beneficiaries have access to an Advantage plan.6
How to enroll in Medicare Advantage
The easiest way to enroll in Medicare Advantage is to speak to one of our experienced sales agents, but you can use the Medicare.gov site instead or call the carrier of the plan you want directly.
There are four periods when you can enroll in a Medicare Advantage plan:5
- Initial Coverage Election Period (ICEP)
- Open Enrollment (also known as the Annual Election Period, or AEP)
- A Special Enrollment Period (SEP), available in some cases
- Medicare Advantage Enrollment Period (if you want to switch to a different MA plan)
Which period should you use? That depends on your situation.
You’re newly eligible for Medicare
If you’re turning 65 or about to receive your 25th month of disability benefits and you become newly eligible for Medicare, you’ll have an Initial Enrollment Period (IEP) during which you can sign up for Original Medicare, Parts A and B.
Once you do that, you can enroll in Medicare Advantage during an Initial Coverage Election Period (ICEP). ICEPs usually happen concurrently with IEPs. In other words, the two periods span the same seven months.
What does that mean? If you enroll in Parts A and B early enough in that seven months, you can also switch to Medicare Advantage right away before time runs out to get Part C coverage.
This might seem like an overly complicated system for onboarding first-time Medicare recipients, but you’ll only have to do this once, and our licensed agents can help.
You want to switch to Medicare Advantage after having Original Medicare
If you miss your Initial Coverage Election Period or decide to change from Original Medicare to Medicare Advantage years down the line, you can do so during Open Enrollment. During this annual period between October 15 and December 7, you can shop for Medicare Part C plans that will kick in January 1 of the following year.
You lose your current Medicare Advantage plan
If this happens to you, you can get a Special Enrollment Period that allows you to choose another Medicare Advantage plan if one is available in your area. An SEP lets you continue getting coverage without having to wait for Open Enrollment.
Types of Medicare Advantage plans
As mentioned above, there are more than 3,700 Medicare Advantage plans available in 2019. That’s a lot of choices! Before your head starts swimming with possibilities, where you live could whittle down your options considerably.
Another way to carve away a large chunk is to decide which type of plan you want. Most MA plans fall into one of five types:8
You may be familiar with Health Maintenance Organization plans because they’re popular among employer-provided insurance options too.
Medicare Advantage HMOs operate similarly, requiring you to choose a primary care doctor and (in most situations) only visit doctors, specialists, or hospitals within the plan’s network. An HMO plan usually requires beneficiaries to choose a primary doctor and get a referral from this provider before seeing a specialist.
Of course, if you have an emergency or go on vacation away from your coverage area and require urgent care or kidney dialysis, these won’t apply.
Medicare Advantage PPO plans (Preferred Provider Organization) operate much like their employer-provided counterparts. Like HMOs, they offer a network of doctors and hospitals. The difference is you can instead choose to get services out of that network if you don’t mind paying more out of pocket.
Many people prefer this flexibility, along with the fact that PPOs generally don’t require that you choose a primary care physician or get a referral before seeing a specialist.
Less common than HMOs and PPOs, Medicare Private-Fee-for-Service (PFFS) plans allow you to visit any Medicare-approved doctor or facility that agrees to treat you and accepts the plan’s payment for services.
The catch is that providers can refuse to treat you (in non-emergency situations, of course) because they don’t like the plan’s payment terms. This means you need to get an agreement in writing from every provider, every time you see them before you get treatment, or you’ll risk having to foot the entire bill.
Some PPFS plans get around this by working with a network of providers who will always treat you. Going outside this network means you take the risk.
SNPs (Special Needs Plans)
Insurance companies design Special Needs Plans (SNPs) specifically for people with certain health conditions or living circumstances, such as people with end-stage renal disease or diabetes, or nursing home residents. Plans focus on benefits the group needs most and companies carefully coordinate care. An SNP for people with diabetes might cut deals with diabetic testing suppliers for cheaper prices and cover nutritional coaching, but could charge a high copayment for emergency care, for example.
Medical Savings Account (MSA) plans operate similarly to how employer-provided Health Savings Accounts (HSAs) do. The Medicare program gives a set amount of money to the plan for your care, and the plan deposits a portion of these funds into a health savings account for you.
You can use these funds to pay for your medical care. Once the funds dry up, you’ll cover all medical costs until you reach the plan’s deductible, which will likely be quite high.
Why choose Medicare Advantage?
If potentially enrolling in a new plan next year or having to choose between hundreds of plans seems daunting, you might be wondering why you’d consider Medicare Advantage in the first place.
Most people who choose Medicare Part C do so for the following reasons:
All the extras
The federal government requires that all Medicare Advantage plans offer coverage equivalent to Original Medicare or (and here’s the critical part) better.9 That means many MA plans cover more services, like vision care and prescription drug coverage.
That “or better” requirement also allows private companies to offer lower deductibles than Original Medicare offers.
It’s true that Medicare supplement plans (Medigap) help cover out-of-pocket expenses in Original Medicare (for an additional premium), and that in some states you can get an “innovative” Medigap policy that throws in coverage for one or two extras like vision or dental.
But Medigap plans require an additional monthly premium, while some Medicare Advantage plans offer comparable benefits without asking for a penny more than you’d pay for Original Medicare.
Comprehensive coverage from one place
Okay, so you can get prescription drug coverage and help with paying deductibles with Original Medicare in the form of a stand-alone Part D plan and a Medigap plan (both of which are provided by private insurance companies like Part C plans). But that means you’ll get separate bills from each policy you have.
Knowing when and where each plan covers you can get confusing too.
With a Medicare Advantage plan, however, all your coverage comes from a single source, which can make things simpler.
Compare Medicare Advantage plans
Sorting through the possibilities to find the best Medicare Advantage plan may seem daunting, but it doesn’t have to be.
Narrow your choices quickly with our Suggest-a-Plan tool, or just give us a call. Our experienced licensed sales agents can help you understand your options and help you enroll.
- Medicare.gov, “How to Get Drug Coverage”
- CMS.gov, “2019 Medicare Parts A & B Premiums and Deductibles”
- CMS, “2019 Medicare Advantage and Part D Prescription Drug Program Landscape”
- Medicare.gov, “Who Can Join a Medicare Advantage Plan?”
- Mwe.com, “21st Century Cures: Congress Enacts Medicare Advantage and Small Business Insurance Market Reforms”
- CMS, “2019 Medicare Advantage and Part D Prescription Drug Program Landscape”
- Medicare.gov, “Joining a Health or Drug Plan”
- Medicare.gov, “Medicare Advantage Plans”
- Medicare.gov, “How Do Medicare Advantage Plans Work?”
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