In 2023, projections indicate that 31.8 million people will join a Medicare Advantage plan. But not everyone will experience lower costs, more benefits, or better care.
In this article, you will learn everything most people want to know about Medicare’s private health insurance program — Medicare Part CMedicare Part C is Medicare's private health plan option. Also known as Medicare Advantage, Medicare Part C plans are a type of Medicare health plan offered by companies that contract with Medicare to provide all... — before making the decision to join a private health plan.
Key Takeaways
- Medicare Advantage is Part C of Medicare. It is the private health insurance option for people with Medicare Part AMedicare Part A is hospital coverage for Medicare beneficiaries. It covers inpatient care in hospitals and skilled nursing facilities. It also covers limited home healthcare services and hospice care. and Part B benefits.
- Plans provide the same coverage and benefits as traditional MedicareOriginal Medicare is private fee-for-service health insurance for people on Medicare. It has two parts. Part A is hospital coverage. Part B is medical coverage..
- Plans do not always save their members money. Both inpatient and outpatient costs can be higher for some people.
- Plans are most beneficial if you are healthy and/or receive assistance paying your out-of-pocket costs.
- Plans can include additional benefits such as prescriptions, dental, vision, and hearing.
- Plans have an annual maximum out-of-pocket expenseOut-of-Pocket Costs for Medicare are the remaining costs that are not covered by the beneficiary's health insurance plan. These costs can come from the beneficiary's monthly premiums, deductibles, coinsurance, and copayments. limit (traditional Medicare doesn’t).
- Most plans are HMOs or PPOs and require members to use the plan’s provider network or pay higher or all costs.
- Most plans require pre-approvals and referrals from a primary care doctor (traditional Medicare doesn’t).
- Part C plans are sometimes called Medicare replacement plans, Medicare all-in-one plans, and Medicare managed care plans.
- Medicare Part C plans are necessary when other insurance, such as a Medicare SupplementMedicare Supplements are additional insurance policies that Medicare beneficiaries can purchase to cover the gaps in their Original Medicare (Medicare Part A and Medicare Part B) health insurance coverage. or MedicaidMedicaid is a public health insurance program that provides health care coverage to low-income families and individuals in the United States. is not an available option.
What Does Medicare Part C Cover?
Medicare Advantage plansMedicare Advantage (MA), also known as Medicare Part C, are health plans from private insurance companies that are available to people eligible for Original Medicare (Medicare Part A and Medicare Part B). combine everything in Medicare Part A (hospital insurance) and Part B (medical insurance) into a single, managed care solution. Plus, private Medicare plans can include extra benefits:
- Prescription drug coverage and over-the-counter medications
- Wellness programs and fitness memberships
- Routine dental, vision, and hearing care
- Transportation to medical appointments
- Telemedicine
- Alternative medicine, such as acupuncture
There are also some uncommon extra benefits, like in-home support, bathroom safety, telemonitoring, caregiver support, and a Part B rebate.
Call 1-855-728-0510 (TTY 711) for plan assistance.
If you qualify for Medicare and don't know where to start, MedicareEnrollment.com, an independent HealthCompare insurance broker, has licensed agents who can help you with your Medicare enrollment options.
What Plans Cover vs Original Medicare
All Medicare Part C plans cover the core services in Medicare Part A and Part B. However, they are not required to provide coverage in the same way.
For example, Part B covers about 80% of your doctor visits, x-rays, lab tests, and other outpatient services. You pay the other 20% out-of-pocket.
Plans set their own outpatient careOutpatient Care is medical care that does not require an overnight stay at the hospital. Medicare Part B provides coverage for Outpatient Care. copay amounts. The same is true with inpatient careInpatient care refers to care provided in a hospital or other inpatient facility. Inpatients are admitted and stay at least one night depending on their condition., including skilled nursing facility care, and hospiceHospice is a special way of caring for people who are terminally ill. Hospice care involves a team-oriented approach that addresses the medical, physical, social, emotional, and spiritual needs of the patient. care.
Plans include all Medicare Part BMedicare Part B is medical coverage for people with Original Medicare benefits. It covers doctor visits, preventative care, tests, durable medical equipment, and supplies. Medicare Part B pays 80 percent of most medically necessary healthcare services. wellness services and may include more, such as gym memberships. And most plans include a Part D plan for outpatient prescriptions. Some offer additional Medicare Part DMedicare Part D plans are an option Medicare beneficiaries can use to get prescription drug coverage. Part D plans provide cost-sharing on covered medications in four different phases: deductible, initial coverage, coverage gap, and catastrophic. Each... gap coverage to help you out in what’s known as the donut hole.
Except in the event of an emergency, plans are not required to cover you out-of-state. And plans do not cover foreign travel emergencies.
What Are Medicare Part C (Medicare Advantage) Costs?
Costs vary widely from plan to plan, making it difficult to determine an average cost. Plans with a higher monthly premium generally offer more benefits and services, or they have lower shared costsAn amount patients pay for their share of the cost of medical service or supply, like a doctor’s visit, hospital inpatient visit, or prescription drug. (deductiblesA deductible is an amount a beneficiary must pay for their health care expenses before the health insurance policy begins to pay its share., copaysA copayment, also known as a copay, is a set dollar amount you are required to pay for a medical service., and coinsuranceCoinsurance is a percentage of the total you are required to pay for a medical service. ).
The cost-sharing structure of Part C plans makes it difficult to calculate an annual out-of-pocket cost or even an average cost. However, every plan has an annual maximum out-of-pocket (MOOP) limit on Part A and Part B services.
Some Medicare Advantage plans have a zero-dollar premium, but they are not free. In all cases, plan members continue paying their Part B premium and Income Related Monthly Adjustment Amounts (IRMAAIncome Related Month Adjustment Amount (IRMAA) is a Medicare Part B and Medicare Part D premium surcharge that is levied on high-income earners. The surcharge amount is based on a beneficiary's adjusted gross income.).
Should I Enroll In A Medicare Advantage Plan?
The primary advantage of Medicare Advantage is the ability for plans to add extra health benefits. In this way, many plan members get a fully managed all-in-one Medicare plan solution.
A good way to understand if Medicare Advantage or Original Medicare is right for you is to know the pros and cons of each.
Original Medicare Pros and Cons
- Pros
- No provider networks. Coverage is nationwide.
- You don’t need a referral to see a specialist.
- You can get routine treatments and tests without prior authorizationPrior authorization is a process used by health plans to control healthcare costs. Most HMO plans and some PPO plans require authorization before receiving certain treatments, medical services, or prescription drugs..
- Medical supplies and durable medical equipmentDurable medical equipment (DME) is equipment that is designed to last and can be used repeatedly. It is suitable for home use and includes wheelchairs, oxygen equipment, and hospital beds. are covered with 20% cost sharing.
- You can get supplemental insurance (Medigap) to help with out-of-pocket costs.
- Cons
- You need separate coverage for prescriptions and routine dental care, vision, and hearing aids.
- Some doctors and specialists charge Part B Excess ChargesA Medicare Part B excess charge is the difference between a health care provider’s actual charge and Medicare’s approved amount for payment..
- There’s no limit on annual out-of-pocket costs, however, a Medicare Supplement will cover some out-of-pocket costs.
- Some diabetes programs, preventive care, and counseling are covered, but gym memberships, weight-loss programs, and annual physicals are not covered.
Medicare Part C Pros and Cons
- Pros
- A primary care doctor typically manages your overall plan and access to care, including referrals to specialists.
- Most insurance plans include prescription drug coverage (Part D plan).
- Many plans offer additional benefits, such as routine dental, vision care, and hearing.
- Special Needs Plans (SNPs) offer additional benefits for people eligible for Medicaid, institutionalized individuals, and people with certain chronic conditions.
- Cons
- Except in the event of an emergency, most plans require members to use the plan’s network.
- Depending on the plan options, you may not be able to see your preferred doctor(s).
- Treatments and tests often require pre-authorization.
- The annual cap on many plans is high and monthly premiumsA premium is an amount that an insurance policyholder must pay for coverage. Premiums are typically paid on a monthly basis. In the federal Medicare program, there are four different types of premiums. may be higher.
- Benefits and copays can change annually.
- Hospitalization costs in many plans are higher than in Original Medicare.
Are you still unsure which is the best path for you? Check out Why Medicare Advantage Plans are Bad to get some additional perspectives.
What Types of Plans Are Available?
There are several different types of Medicare Advantage plans (MA) available to suit different needs. All plan types, except MSA plans, are available as MAPD plans and MA plans. MAPD plans include Part D benefits, whereas MA plans do not.
- Health Maintenance Organization (HMO) plans provide healthcare services through a local network of providers at a set cost per service. Most services have a copay or coinsurance paid by the member. Except in the event of an emergency, you must use the plan’s provider network or pay all costs.
- Preferred Provider Organization (PPO) plans are the most common type of Medicare Advantage plan. PPO plans have a preferred provider network but offer the flexibility to go outside of the network as needed, with additional costs.
- Health Maintenance Organization Point of Service (HMO-POS) plans offer the cost benefits of an HMO and the out-of-network benefits of a PPO. Most plans require you to use their network for medical care but give you options to go out-of-network for dental, vision, hearing, and other routine care.
- Private Fee-for-Service (PFFS) plans sound a lot like Original Medicare, but there are restrictions. Most PFFS plans have a contracted network of providers and the plan determines how much it will pay for your doctor visits.
- Medicare Savings Account (MSA) plans are similar to a Health Savings Account. You can use the money from an MSA plan to pay Medicare-covered expenses before you reach your deductible.
- Medicare Special Needs (SNP) plans are private health plans that serve people with special needs. While technically not its own plan type, SNP plans are only available to dual-eligibleDual-eligible beneficiaries are those who receive both Medicare and Medicaid benefits. It includes beneficiaries enrolled in Medicare Part A and/or Part B while receiving full Medicaid and/or financial assistance through a Medicare Savings Program.... individuals with Medicare and Medicaid (D-SNP), people who are institutionalized (I-SNP), and beneficiaries with certain chronic health conditions (C-SNP).
RELATED: Can You Have Both Medicare and Medicaid?
Find Plans in your area with your ZIP Code
Am I Eligible For Medicare Advantage?
Plans are available to anyone enrolled in both Medicare Part A and Part B. Enrollment depends on the plan’s availability in your area. However, you can only join a plan at certain times during the year.
Here’s an eligibility checklist:
- Enroll in Medicare Part A.
- Enroll in Medicare Part B.
- Live in the plan’s service area.
- Have a valid Enrollment Period.
Previously, individuals with certain pre-existing conditionsA pre-existing condition is any health problem that occurred before enrolling in a health plan. The Affordable Care Act law made it illegal for health plans to or charge more due to a pre-existing condition.... like end-stage renal diseaseEnd-Stage Renal Disease (ESRD), also known as kidney failure, is a condition that causes you to need dialysis or a kidney transplant. People with ESRD are eligible for Medicare coverage regardless of age. (ESRD), did not qualify to enroll. This is no longer the case.
When Can I Enroll?
If you are new to Medicare, you will be given an Initial Enrollment Period (IEP).
If you move out of your plan’s service area, lose your Medicaid benefits, or have another special circumstance, you can ask for a Special Enrollment PeriodSpecial Enrollment Periods (SEPs) allow beneficiaries to change their Medicare Advantage and Part D plans due to a special circumstance. Common reasons for a SEP include moving, losing employer coverage, and Medicaid eligibility, to name....
If you do not have an IEP or a SEP, you will need to wait until the next Open Enrollment PeriodDuring the Medicare Open Enrollment Period, Medicare Advantage and Part D plan members can change, switch, or drop a plan they chose during the Annual Election Period. OEP starts on January 1 and ends on March 31. to join, change, or drop a plan.
How Do I Enroll?
There are three ways to join:
- Call Medicare directly at 1-800-MEDICARE (TTY 711).
- Call the plan’s sales line.
- Use an independent agent or broker licensed in your state and contracted with the plan you want.
Find Plans in your area with your ZIP Code
References and Citations
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- medicare.gov
- Explore your Medicare coverage options
https://www.medicare.gov/plan-compare/ - Welcome to Medicare | Medicare
https://www.medicare.gov/ - https://www.medicare.gov/Pubs/pdf/12026-Understanding-Medicare-Advantage-Plans.pdf
- Explore your Medicare coverage options
- cms.gov
- 2023 Medicare Parts A & B Premiums and Deductibles 2023 Medicare Part D Income-Related Monthly Adjustment Amounts | CMS
https://www.cms.gov/newsroom/fact-sheets/2023-medicare-parts-b-premiums-and-deductibles-2023-medicare-part-d-income-related-monthly - https://www.cms.gov/Medicare/CMS-Forms/CMS-Forms/Downloads/CMS-L564E.pdf
- Biden-Harris Administration Announces Lower Premiums for Medicare Advantage and Prescription Drug Plans in 2023 | CMS
https://www.cms.gov/newsroom/press-releases/biden-harris-administration-announces-lower-premiums-medicare-advantage-and-prescription-drug-plans
- 2023 Medicare Parts A & B Premiums and Deductibles 2023 Medicare Part D Income-Related Monthly Adjustment Amounts | CMS
- hhs.gov
- What is Medicare Part C? | HHS.gov
https://www.hhs.gov/answers/medicare-and-medicaid/what-is-medicare-part-c/index.html - Who’s eligible for Medicare? | HHS.gov
https://www.hhs.gov/answers/medicare-and-medicaid/who-is-elibible-for-medicare/index.html - Health Care | HHS.gov
https://www.hhs.gov/healthcare/
- What is Medicare Part C? | HHS.gov
- kff.org
- Medicare Advantage 2022 Spotlight: First Look | KFF
http://www.kff.org/issue-brief/medicare-advantage-2022-spotlight-first-look - Medicare Advantage in 2022: Enrollment Update and Key Trends | KFF
https://www.kff.org/medicare/issue-brief/medicare-advantage-in-2022-enrollment-update-and-key-trends/ - http://www.kff.org/medicare/7729.cfm
- Medicare Advantage 2022 Spotlight: First Look | KFF
- medicare.gov