What is Medicare Advantage?
Medicare Advantage plans are health insurance plans that are offered by private insurance companies who are approved by Medicare. Often called “MA plans” or Part C plans, Medicare Advantage gives retirees a way to get traditional Medicare coverage plus extra benefits, like vision and dental coverage, all in one stop. There are many MA plans to choose from, and each may vary in cost and benefits. However, every MA plan must provide the same basic coverage as Medicare Parts A and B.
Similar to traditional insurance options, MA plans come in two forms: HMOs and PPOs.
A Refresher on HMOs and PPOs
An HMO (health maintenance organization) is an insurance plan that features a “network” of approved doctors, hospitals and other health care facilities. You may hear the terms “in network” and “out of network” with an HMO.
If you go to an “in network” doctor or hospital, it means that the provider is approved by your plan. You will likely pay a lower rate for care. If you go to an “out of network” provider, you will likely pay a larger portion (if not all) of your medical bill from your own pocket. This is because the provider is not in your HMO plan’s network. While there are many other features to an HMO, the main thing to know is that they use networks to manage care and costs.
A PPO (preferred provider organization) is best known as being an insurance plan that gives you more flexibility on the doctors you see and the health care facilities you use. PPOs also use a network of doctors and providers as part of the plan. However there aren’t as many rules on which doctors and locations you can visit.
What Does Medicare Advantage Cover?
At their core, MA plans are required to cover the same things that original Medicare covers (Part A and Part B). However, most MA plans cover extra benefits like vision, dental and hearing coverage.
Some MA plans also include coverage for some prescription drugs. These types of plans are called Medicare Advantage Prescription Drug plans (MAPDs). Each MAPD has its own formulary, which is a list of drugs covered under the plan. If your drug is not on the formulary, you will likely pay 100% of the cost of that drug out of pocket. If your drug is on the formulary, your MAPD plan will pay a portion of the drug’s cost.
Read More: What Exactly is a Part D Formulary?
MA and MAPD plans vary in coverage and cost, and insurance companies may offer similar plans at different price points. Because plans can vary, it’s important to shop around to find the plan that best meets your needs.
When to Enroll in a Medicare Advantage
If you are interested in an MA plan, you have two opportunities to enroll:
- Initial Enrollment Period – Your Initial Enrollment Period (IEP) is when you are enrolling in Medicare for the first time. During your IEP, you will have the option to purchase a Medicare Advantage plan. If you are already retired, your IEP will likely begin when you turn 65 and first become eligible for Medicare. If you choose to work beyond age 65, you will likely be granted your IEP when you retire.
- Annual Enrollment Period – If you are already enrolled in a Medicare plan, Medicare’s Annual Enrollment Period (AEP) is your chance each year to make any changes to your current Medicare plan or select a new Medicare plan. Many retirees who are new to Medicare do not know that insurance companies can make changes to the Medicare plans they offer each year. These changes include things like costs, benefits, which doctors/hospitals/prescriptions are covered and more. It’s important to review your plan each year to make sure that its coverage and costs still meet your lifestyle, budget and needs.
Learn More about Medicare Advantage
Still have questions about Medicare Advantage plans? Call us at 1-866-600-5638! Our team of licensed Benefit Advisors can answer your questions and help you determine if a Medicare Advantage plan is right for you.