Medicare Advantage (MA or Part C), is a popular alternative to traditional Medicare. Since 2010, enrollment increased by 71 percent, with as many as one in every three eligible seniors today choosing a Medicare Advantage plan over Original Medicare. Understanding this option is a critical step in managing health care into retirement.
Medicare vs Medicare Advantage
Medicare coverage includes hospital insurance (Part A) and medical insurance (Part B). While Part A is free for most people, Part B carries a monthly premium. Prescription drug benefits (Part D) are not part of Original Medicare but can be added for an additional monthly premium. While a good percentage of costs are covered, seniors are responsible for out-of-pocket expenses, like deductibles, coinsurance, and copays. Part C is offered by private insurance companies as an alternative way to receiving Original Medicare. With an MA plan, you receive Part A and Part B benefits, as well as additional benefits not covered by traditional Medicare. Most plans include coverage for prescription drugs, as well as dental, vision, and in some cases, even hearing. Unlike Original Medicare, with Medicare Advantage, you are limited to doctors and hospitals that are part of a specified network. Networks can be large, or narrow depending on where you live and a referral may be needed to see a specialist.
Extra Benefits
While plans must cover all of the services offered through Part A and Part B (except hospice care), most offer more. Many provide comprehensive coverage—Part A, Part B, preventive dental, eye care, hearing assistance, wellness programs, and prescription drug coverage too. If you need new eyeglasses or simply want to explore your options with dentures, an MA plan may be the solution. Plus, plans always cover emergency and urgent care. They even offer emergency services outside of the plan’s service area (but not outside the U.S.). Medicare Advantage has grown significantly in the past few years, and now covers 31 percent of the 57 million people on Medicare. An easy way to secure Part A, Part B, and a few extra benefits. Part C is an all-in-one solution—hospital, medical, vision, dental, and prescription drug coverage.
Good Deal?
With comprehensive benefits and low premiums, Medicare Advantage sounds like a great deal. After all, putting together a similar plan using traditional Medicare would mean adding a prescription drug premium and maybe even Medigap to shoulder out-of-pocket costs. However, it’s important to look at your needs carefully to decide if Medicare Advantage makes sense for you.
Things to Consider
Network Availability Medicare Advantage may be a good option if the network includes providers you already use. Look carefully at which doctors are in the plan’s network, and whether or not you need a referral to see a specialist.
Out-of-pocket Expenses For those in good health who don’t expect to visit the doctor’s office or hospital regularly, Medicare Advantage can be a great asset, offering additional benefits at a low cost. If, on the other hand, you will be visiting the doctor frequently and expect to have many copays, traditional Medicare supplemented with a Medigap plan can help with expenses.
The Bottom Line
Medicare Advantage is a great option for seniors looking for comprehensive care at an affordable price. As long as you can work within the network model, and won’t be needing a lot of specialized care, an MA plan may be a good deal.
References:
Medicare Advantage Stats: http://www.kff.org/medicare/issue-brief/medicare-advantage-2017-spotlight-enrollment-market-update/
MUC56-2017-BCBS
