What is the biggest disadvantage of medicare advantage

Summary:

Medicare Advantage, also known as Medicare Part C, makes it possible for people with Medicare Part A (hospital insurance) and Part B (medical insurance) to receive their Medicare benefits in an alternative way. Medicare Advantage plans are offered by private insurance companies contracted with Medicare and provide at least the same level of coverage that Original Medicare provides.

You may be wondering which is the better choice: sign up for a Medicare Advantage plan or Original Medicare. There isn’t a simple answer because Medicare Advantage plans have key features that many people find attractive and other characteristics that may not match with your personal preferences and/or lifestyle. Let’s take a closer look at some of the important pros and cons of Medicare Advantage plans.

The Pros of Medicare Advantage Plans

Medicare Advantage plans often provide more benefits than you would receive under Original Medicare.

Medicare Advantage plans must offer at least the same level of coverage as Medicare Part A and Part B and many plans offer added benefits. These may include coverage for routine vision care, hearing aids, routine dental care, prescription drug coverage, and fitness center membership.

Medicare Advantage Plans May Cost You Less

If you enroll in a Medicare Advantage plan, you must continue to pay your Medicare Part B premiums and you may pay an additional premium. The insurer determines the Medicare Advantage plan’s premium, which can vary from one Medicare Advantage plan to another. Some Medicare Advantage plans may offer enrollees monthly premiums as low as $0.

Your cost sharing may also be less under Medicare Advantage. For, example, if an enrollee visits a primary care physician under Medicare Advantage, they may have a copayment of $10. However, if the enrollee visits a primary care physician under Original Medicare, they may have a coinsurance of 20%, which could be more than $10.

Also, a Medicare Advantage plan limits your maximum out-of-pocket expense. Once you have spent that maximum, you typically pay nothing for covered medical services for the remainder of the year. Original Medicare does not provide a maximum out-of-pocket cap, so potential expenses are limitless.

Often a Medicare Advantage plan can be less expensive than comparable coverage with Original Medicare. To get the most out of a Medicare Advantage plan with Original Medicare, you may also need to enroll in a stand-alone Medicare Part D Prescription Drug Plan as well as a Medicare Supplement Insurance plan.

Medicare Advantage plans coordinate care among your health care providers.

Typically Medicare Advantage plans are managed care and have networks of contracted health care providers. Example would be Health Maintenance Organization (HMO) Medicare Advantage plans. In most cases, HMO plans require enrollees to select a Primary Care Physician (PCP) who helps to coordinate their care.

Medicare Advantage plans that include Medicare prescription drug coverage may also have medication therapy management. This care coordination can be a convenience and a valuable aid to your health.

Medicare Advantage plans can serve as your “one-stop” center for all your health and prescription drug coverage needs.

Most Medicare Advantage plans combine Original Medicare and prescription drug coverage. Many also coordinate the delivery of added benefits, such as vision, dental, and hearing care. You may prefer the convenience of working with one plan administrator.

Cons of Medicare Advantage Plans

Medicare Advantage plans may limit your freedom of choice in health care providers

With the federally administered Medicare program, enrollees can generally go to any doctor or facility that accepts Medicare and receive the same level of Medicare benefits for covered services. In contrast, Medicare Advantage plans may be more restricted in terms of their provider networks. If you go out of network, your plan may not cover the medical costs, or your costs may not apply to your out-of-pocket maximum.

Medicare Advantage plans’ coverage for some services and procedures may require doctor’s referral and plan authorizations.

Medicare Advantage plans try to prevent the misuse or overuse of health care through various means. This might include prior authorization for hospital stays, home health care, medical equipment, and certain complicated procedures. Medicare Advantage plans may also require your primary care doctor’s referral to see specialists before they will pay for services.

Are There Different Types of Medicare Advantage Plans?

There are a total of six Medicare Advantage plans (Part C) to choose from. The four most commonly used are:

The first type of Medicare Advantage plan is a Health Maintenance Organization (HMO), you will receive your necessary coverage in-network, with the exceptions of: Emergency care; Out-of-area urgent care; Out-of-area dialysis. In some HMO cases, you will need a referral for specialist visits.

The next kind of Medicare Advantage plan is Preferred Provider Organization (PPO) plan, you are medically covered through a private Medicare-approved insurance company. One of the advantages of PPO is that you can save money by seeing the plans in-network providers.

The third Medicare Advantage plan is Private Fee-for-Service (PFFS) Plan. These plans are also offered by private Medicare-approved insurance companies, and the plan determines how much enrollees will pay health care providers and other coverage. This information is provided in ‘Annual Notices of Change’ and ‘Evidence of Coverage’ documents that are sent to enrollees each year.

The last type of Medicare Advantage plan is the Special Needs Plan (SNP) which is ideal for enrollees who have specific medical diseases or characteristics. With these plans, Medicare tailors coverage and benefits to meet the specific needs of the groups served.

Medicare Advantage plans have specific service areas.

Most Medicare Advantage plans have regional (rather than nationwide) networks of participating providers. To enroll, you must reside in the Medicare Advantage plan’s service area at least 6 months of the year. If you divide your time between homes located in different areas, this requirement may be difficult to meet.

The bottom line is that Medicare Advantage plans may provide more affordable coverage than you would receive otherwise. The trade-off is that you have to follow the Medicare Advantage plan’s rules to receive payment for covered services.

Do you have other questions about Medicare Advantage?  Call us and speak with a licensed insurance agent about finding Medicare Advantage plans in your area and your Medicare coverage options. Or just enter you zip code on this page.

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