Over 28 million Medicare beneficiaries get their Medicare Part A and Part B benefits through Medicare Advantage Plans from private insurers. If you join a Medicare Advantage Plan, Medicare still provides funding for your care, but what costs will you pay out-of-pocket vs what does Medicare cover?
In this article, we’ll look at what medical services Original Medicare pays for that apply to Medicare Advantage coverage, along with some of the out-of-pocket costs you may be responsible for under Medicare Advantage.
Medicare Advantage Plans Include Part A and Part B
When you enroll in a Medicare Advantage Plan, Medicare pays your plan a fixed monthly amount for your care based on your age, health status, and location. In exchange for this capitated payment, your Medicare Advantage Plan takes over administration of your Medicare Part A and Part B benefits.
Medicare requires that all Medicare Advantage Plans cover medically necessary Part A and Part B services, with the same scope of benefits as under Original Medicare. Your plan cannot refuse to cover any healthcare service that Original Medicare would cover.
So in that regard, you still have the same Part A hospital and Part B outpatient medical coverage through your Medicare Advantage insurer that Original Medicare would provide.
Out-of-Pocket Costs Vary by Medicare Health Plan
While the coverage may be similar under Medicare Advantage Part A and Part B benefits, what you pay out-of-pocket for services can vary significantly depending on the specific plan:
- Monthly Premiums – Costs range from $0 to over $100 per month for Medicare Advantage Plans. Higher premiums tend to come with lower deductibles and copays.
- Deductibles – Many Medicare Advantage Plans have $0 deductibles, unlike Original Medicare. But some plans do charge deductibles.
- Copays – The copay amount you pay for a doctor visit, hospital stay, or procedure will depend on your Medicare Advantage Plan’s copay structure. Copays vary.
- Coinsurance – Most Medicare Advantage Plans also offer or charge fixed copays and do not apply coinsurance. But some plans do have coinsurance costs.
- Out-of-Pocket Maximum – All Medicare Advantage Plans have a yearly limit on your costs for Part A and Part B covered medical services. Once you hit the plan’s out-of-pocket max, you pay nothing.
So while Medicare requires Medicare Advantage Plans to cover the same services, what you’ll pay out-of-pocket for that coverage can vary widely depending on the plan.
Medicare Advantage Plans Often Offer Extra Benefits
In addition to including Medicare Part A and Part B benefits, most Medicare Advantage Plans also provide extra benefits not covered by Original Medicare:
- Prescription drug coverage
- Dental care
- Vision care
- Hearing aids
- Wellness programs
- Over-the-counter allowances
Medicare does not pay the plan directly for these extra benefits. But most Medicare Advantage insurers include extra benefits as a way to attract enrollment.
The specific extra benefits offered will vary by each Medicare Advantage Plan. Some plans have more generous benefits than others. These benefits are a key advantage of Medicare Advantage Plans over Original Medicare.
You Must Follow the Plan’s Rules
While Medicare pays for Part A and Part B services under Medicare Advantage, you will need to follow some key rules from your plan:
- Use in-network doctors and hospitals – Most plans only cover out-of-network services in emergencies.
- Get prior authorization for certain services – Your plan may require pre-approval for some procedures.
- Go to certain pharmacies or use mail order for prescriptions – Each plan has its own pharmacy network.
- Provide referrals from your PCP to see specialists – Referrals are often required, especially with HMOs.
Not following your Medicare Advantage Plan’s rules can result in non-coverage of services or higher out-of-pocket costs. Make sure you understand how your plan works.
The Bottom Line
In summary, Medicare continues to provide the funding for your Part A and Part B benefits when you join a Medicare Advantage Plan. But you may pay different out-of-pocket costs compared to Original Medicare.
Plans have flexibility around what you pay for deductibles, copays, and coinsurance. Medicare Advantage Plans also typically provide additional benefits beyond what Original Medicare covers.
Understand all the costs and coverage rules laid out by your Medicare Advantage insurer to know what Medicare will pay for and what out-of-pocket expenses you may incur under your plan’s policies.
We’re Here to Help
You do not have to spend hours reading articles on the internet to get answers to your Medicare questions. Give the licensed insurance agents at Glidden Group a Call at (208) 962-0077. You will get the answers you seek in a matter of minutes, with no pressure and no sales pitch. We are truly here to help.
Does Medicare Pay Anything If You Have a Medicare Advantage Plan?
A: Yes, Medicare still pays for your covered services if you have a Medicare Advantage Plan. However, the way Medicare pays for these services may be different when you have a Medicare Advantage Plan compared to when you have Original Medicare.
What is the difference between Original Medicare and a Medicare Advantage Plan?
Original Medicare is a fee-for-service health plan offered directly by the federal government. It has two parts – Part A (hospital insurance) and Part B (medical insurance). Medicare Advantage Plans, also known as Medicare Health Plans, are offered by private insurance companies and provide all the benefits of Original Medicare plus additional coverage for prescription drugs, dental services, and other benefits.
Do I need to pay a premium for a Medicare Advantage Plan?
A: Yes, most Medicare Advantage Plans require you to pay a monthly premium in addition to your Part B premium. The Part B premium is the amount you pay to Medicare for your medical insurance coverage.
What types of Medicare Advantage Plans are available?
A: There are several types of Medicare Advantage Plans available, including Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), Private Fee-for-Service (PFFS) plans, and Special Needs Plans (SNPs). Each type of plan has its own rules and requirements.
Are all Medicare Advantage Plans the same?
A: No, Medicare Advantage Plans can vary in terms of benefits, costs, coverage, and network of providers. It’s important to compare different plans and choose one that best suits your needs.
Can I still use my Medicare Advantage Plan if I travel outside of my plan’s service area?
A: It depends on the type of Medicare Advantage Plan you have. Some plans may offer coverage for services received outside of their service area, while others may require you to use network providers within their service area. It’s important to check with your plan to understand its coverage rules when you travel.
Can I have a Medicare Advantage Plan and a separate Medicare drug plan?
No, you cannot have a Medicare Advantage Plan and a separate Medicare drug plan. Medicare Advantage Plans usually include prescription drug coverage, so you don’t need to buy a separate Medicare drug plan.
Can I switch from a Medicare Advantage Plan back to Original Medicare?
A: Yes, you can switch from a Medicare Advantage Plan back to Original Medicare during certain times of the year, such as during the Annual Enrollment Period (October 15 – December 7) or during a Special Enrollment Period if you qualify. It’s important to carefully consider your options before making a switch.
Can I get dental services covered by Medicare with a Medicare Advantage Plan?
Yes, some Medicare Advantage Plans offer dental coverage as an additional benefit. However, not all plans provide dental services, so it’s important to check with the plan to know what services are covered.
Are all doctors and hospitals covered by Medicare Advantage Plans?
Medicare Advantage Plans have a network of doctors and hospitals that you must use to receive the full benefits of the plan. These plans typically cover services provided by doctors and hospitals that participate in Medicare. However, if you go outside of the plan’s network, you may have to pay higher costs or may not be covered for the service.
What additional benefits do Medicare Advantage Plans offer?
Medicare Advantage Plans may offer additional benefits like prescription drug coverage, vision and dental services, wellness programs, and coverage for services not covered by Original Medicare. The specific benefits can vary depending on the plan.