What are Medicare Advantage Plans?

One of the aspects of retirement is ensuring you have health care insurance. One type of coverage available for retirees is Medicare Advantage Plans.

These plans, which are an alternative to Original Medicare, can be an excellent form of coverage to sustain you throughout retirement.

Medicare Advantage plans are Medicare-approved health insurance plans offered by private insurance companies. They MUST offer the same level of coverage as Original Medicare coverage (Parts A and B) but can also offer additional benefits.

Some examples of what can also be offered are:

  • Dental

  • Vision

  • Hearing

  • Podiatry

  • Routine Physicals

  • Transportation

  • Gym memberships

  • Worldwide Emergency

Medicare Advantage Plans have rules that enrollees must follow to qualify for coverage which may include:

  • Limitations on which health care providers the beneficiary may see, or steps that must be followed to ensure a service is covered – in other words “networks”.

  • Possible higher out-of-pocket costs if care is received outside of the specific “network”.

There are many types of Medicare Advantage Plans which offer different benefits and have different rules. There is no standard for Medicare Advantage Plans, but the most two common types are HMOs and PPOs.

Here is a breakdown of each type of Medicare Advantage Plan:
  • HMOs – maintains a provider network and referrals may be necessary. The great aspect of an HMO Plan is that if your healthcare providers are in the network they want to see you.

  • PPOs – also have a provider network, like HMO’s but these plans allow beneficiaries to obtain care outside the network.

  • PFFS – there are no networks. You can see any healthcare providers who accepts the plan.

  • SNPs – membership is limited to certain groups of people, such as those in certain institutions (like a nursing home), those eligible for both Medicare and Medicaid, or those with certain chronic or disabling conditions.

  • HMOPOS -an HMO plan that provides for services outside of the network. These plans may provide the wider range of healthcare providers in most areas

  • MSA – Medical Savings Accounts

Medicare Advantage Plans Pros and Cons

The monthly premium, as well as co-pays tend to be affordable for most plans. Many plans have price caps that keep beneficiary’s expenses down.

Medicare Advantage Plans may change over time.

Networked health providers mean you can rest assured that provider actually wants to see you and that the costs will be covered.

Rules of a networked plan may be set up in a way where a referral is needed before care can be received. This can also make it difficult to obtain care while traveling or otherwise away from home.

The coverage with Medicare Advantage Plans tends to be better than that of Original Medicare often offering additional benefits not available through original Medicare.

Additional benefits may be an add-on that requires higher premiums or may not be a great as advertised.

To find which Medicare Advantage Plans are available in your area please click here.

Source: The official website of the U.S. Government, Medicare.gov.