Medicare vs Medicare Advantage: how to choose

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Deciphering Medicare health insurance plan options can be intimidating for Medicare beneficiaries. Medicare is available for people aged 65 or over.

Deciphering Medicare health insurance plan options can be intimidating for Medicare beneficiaries. Medicare is available for people 65 years of age or older, young people with disabilities, people with Lou Gehrig’s disease (also called amyotrophic lateral sclerosis or ALS), and people with end-stage kidney disease (permanent kidney failure requiring dialysis or transplant).

The original health insurance consists of two parts: Part A and Part B. Part A covers part of hospital costs and Part B applies to doctors’ bills and other medical expenses, such as laboratory tests and certain preventive screenings.

But some people may find better value in Medicare Advantage plans. These plans are operated by private, government-regulated insurance companies, and they must offer coverage comparable to original Medicare Parts A and B. Most Medicare Advantage plans also include prescription drug coverage, called Part D, which is also available for beneficiaries who keep the original Medicare. With Original Medicare, patients can consult any provider in the country that accepts Medicare without any restrictions.

[Read: Medicare Fall Open Enrollment: What You Need to Know.]

Medicare benefit plans

Some Medicare Advantage plans have a monthly premium of $ 0, while others have a higher monthly premium. You must continue to pay your Part B premium, which is $ 148.50 per month for most beneficiaries in 2021. Medicare Advantage plans are similar to individual health insurance policies that you may have received through. through your employer or taken out by yourself through the individual insurance market. , in that they have different monthly premiums, supplier networks, co-payments, coinsurance, and disbursement limits. The trade-off for a lower plan premium (or a $ 0 premium) could include a higher co-pay or coinsurance, smaller provider networks, more restrictions on the use of services, higher limits or less generous prescription drug coverage.

Whether or not a Medicare Advantage plan costs more, it could be more or less beneficial to you than Medicare Original. Consumers should carefully consider the details of each plan and make a lucid assessment of their situation, including their health, budget, and financial risk tolerance.

[READ: What Is a Health Savings Account?]

The advantages and disadvantages of original Medicare versus Medicare Advantage if…

You are taking prescription medication. As noted, Original Medicare does not cover prescriptions unless you enroll in the Independent Drug Benefit Plan (PDP). (The monthly cost of Part D ranged from $ 0 to $ 77.10 per month, based on annual income, in 2021.) According to the Kaiser Family Foundation, a non-partisan, nonprofit research institute, about 86 % of Medicare Advantage plans include prescription drug coverage. In some cases, your monthly premium will exceed the amount you would pay for Medicare Part D. However, you cannot choose a separate drug plan to go with your Medicare Advantage plan. If you take more than one prescription drug, you can find a PDP that covers all of your drugs at your favorite pharmacy, whereas with a Medicare Advantage plan, your drug coverage includes everything that plan offers with no separate choice. The federal government and licensed insurance brokers like PlanPrescriber.com have online tools where you can check how much you’ll pay for the drugs you need. (US News has a revenue generation agreement with eHealthInsurance, owner of PlanPrescriber.com.)

You want a cap on your direct health spending. Original Medicare does not have a maximum amount. You continue to pay a portion of the cost of the services as you use them. Medicare Advantage plans, by law, have a cost limit. The average fee limit for Medicare Advantage registrants is $ 5,091 for network services and $ 9,208 for network and off-network (PPO) services. Once you reach this limit, the plan pays for all covered expenses. Many people with Original Medicare choose to purchase a Medigap policy to help minimize personal liability.

You want an alternative to improving your Medicare coverage with private “Medigap” (Medicare Supplement) insurance. Similar to capping your direct health care expenses, Medigap plans cover or help cover certain deductibles, coinsurance, and out-of-pocket expenses from Original Medicare. Some Medicare Advantage plans, but certainly not all, will be more cost effective than adding Medigap coverage to Original Medicare. Carefully review the details of the plan if that is why you are considering Medicare Advantage. In most states, you do not have guaranteed emission rights on Medigap outside of your initial Medicare enrollment period. If you enroll in Medicare Advantage, you may not be able to purchase a Medigap policy if you later decide to switch to Original Medicare for a larger provider network or increased access to prescription drugs not covered by your original plan. .

You want an alternative to the 20% coinsurance billed by Original Medicare for most services. Medicare Advantage plans structure costs differently and have a maximum amount, which limits how much you must spend on your medical care each year. However, many Medicare Advantage plans charge a 20% coinsurance, which means that this may not be the best alternative.

You want coverage for vision and dental care. Original Medicare does not cover these services. Some Medicare Advantage plans offer some coverage of these benefits, typically including preventative dental care with some cost sharing and possibly additional premiums.

You want the widest possible choice of doctors and other medical providers. More providers accept original Medicare insurance than private Medicare Advantage insurance. With Original Medicare, you can see any provider in the United States accepting Medicare, and almost all providers accept it. Private insurance plans tend to be limited to a specific network, such as a network of health maintenance organizations. If you travel frequently, you may want to consider staying with Original Medicare for this reason.

You want maximum flexibility when looking for specialist doctors. Under Original Medicare, you do not need prior authorization from a primary care physician to see a Medicare registered specialist and accept new Medicare patients, while Medicare Advantage plans designated HMO might require you. to see a primary care physician first. Preferred provider organization plans may allow you to see a specialist without a referral, but seeing a doctor or an off-grid specialist would cost you more. Most Medicare Advantage plans are HMOs or PPOs.

You are still employed and covered by your employer. You could end up paying an unnecessary premium for Medicare Advantage or losing the coverage provided by your employer. Check with your human resources department and the Social Security Administration for more details.

You receive employer-sponsored retiree health benefits that supplement Original Medicare. These benefits would not apply if you upgrade to Medicare Advantage, so check with your human resources department before signing up for a Medicare Advantage plan.

You are eligible for Medicaid or a Medicare savings program. Low-income Medicare beneficiaries have other options and should contact their state Medicaid office.

[Read: Medicare vs. Medicaid: What Is the Difference?]

Register for Medicare Advantage

If you decide to enroll in a Medicare Advantage plan, you can enroll between October 15 and December 7 – the period known as Medicare’s annual election period – so that your coverage begins on the first of the following year. (Original Medicare has separate enrollment periods for beneficiaries who are not automatically enrolled.) Due to government regulations, Medicare Advantage premiums are not influenced by age, health, or method through which a consumer registers (through a licensed insurance agent, for example, or directly through an insurer). The monthly cost – and the availability of the plan – varies from county to county.

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Medicare vs Medicare Advantage: how to choose originally appeared on usnews.com

Update 11/11/21: This story was posted at an earlier date and has been updated with new information.

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