Here are the top reasons to consider Medicare Advantage plans
When you become Medicare eligible you have three general choices for medical coverage.
You can stay with original Medicare. You can purchase a Medicare supplement policy. You can enroll in a Medicare advantage plan. There is no right or wrong choice. It all depends on your budget and circumstances.
This article will focus on Medicare Advantage plans and the top five benefits of this type of plan.
Medicare Advantage, also known as Part C, is not the same as a Medicare supplement but is rather another way to receive your Medicare benefits. Advantage plans are available from private insurance companies which are approved by the Centers for Medicare and Medicaid Services (CMS) to administer your Medicare.
Medicare Advantage benefits
The top five benefits are all related to your money and certainty. Both are certainly important when talking about your medical coverage.
- Medicare Advantage plans include a maximum annual amount out-of-pocket. If you are enrolled in original Medicare you have no way of knowing what your out-of-pocket expenses will be for any given year. You will be subject to a hospital deductible and hospital co-pays for extended stays, as well as being required to pay the 20% for covered outpatient services that are not paid by Medicare. Unless you have a crystal ball there’s no way to know what costs you may be subject to. 2012 Medicare Advantage plans must include a maximum annual amount out-of-pocket (MOOP) of $6700 or less. This could be less than your expenses with original Medicare.
- Advantage plans have set co-pays and co-insurance amounts. These plans will provide some certainty as to what your costs will be for medical services. As an example, a plan may require a $50 co-pay for an emergency room visit. With original Medicare you will be responsible for 20% of the charges for that same visit. You will a greater degree of certainty with an Advantage plan.
- Medicare Advantage plans generally have lower monthly premiums than a Medigap policy. Because the insurance company offering your Advantage plan is receiving payment from CMS to administer your plan you will generally have lower monthly premiums. In some cases you can enroll in an Advantage plan like AARP Medicare Complete and not pay any premium at all. (More: What does a Medicare supplement cost?)
- Part D drug coverage is often included. Many advantage plans include Medicare Part D prescription drug coverage saving you money on purchasing a stand-alone drug plan. If this is important to you make sure that when comparing plans you are comparing plans that include this benefit.(More: Part D formularies are key to plan choice)
- Extra benefits are often included in an Advantage plan. This is one of the main reasons that people enroll in Medicare Advantage. Original Medicare does not include dental, vision, hearing, gym memberships and discounts on health related items like vitamins and supplements. Many Advantage plans include these extras at no additional cost. Some plans will offer a dental rider for a small premium to get you some benefits that are not included as Medicare dental benefits.
Medicare Advantage plans are not for everyone. You may find that you can do without the extras, pay the premium for a Medigap policy and be happy with that choice. But if you are on a budget looking to control costs and like the idea of the extras you may want to compare Medicare Advantage plans.