Medicare Advantage plans, also known as Part C plans, are an alternative to Original Medicare, combining its benefits with additional ones offered by private insurance companies. These plans are required to provide the same coverage as traditional Medicare, including hospitalization and medical coverage, but can also include added benefits such as prescription drug, dental, vision, and hearing care, and fitness programs.
There are various types of Medicare Advantage plans, with the most common being Health Maintenance Organization (HMO), Preferred Providers Organization (PPO), and Special Needs Plans (SNP) options. HMO plans require you to use a network of medical providers for routine doctor visits, hospital stays, and outpatient procedures, with referrals to specialists typically required. PPO plans also involve a network of providers but allow you to choose medical service providers outside of the network, without needing referrals for specialists. SNPs are designed for people with specific health conditions or situations, such as chronic illnesses, dual-eligible beneficiaries (who are eligible for both Medicare and Medicaid), or those living in nursing homes.
Medicare Advantage plans are designed by individual insurance companies, so copayments, coinsurance amounts, and additional benefits may differ between plans. The advantage of these plans is the low or zero cost premiums and the integrated prescription drug coverage. Each plan has a maximum annual out-of-pocket expense, providing a significant advantage over Original Medicare.
To enroll in a Medicare Advantage plan, individuals must first be enrolled in Medicare Part A and Part B. Individuals can enroll in a Medicare Advantage plan during the Initial Enrollment Period (IEP) when they first become eligible for Medicare, or during a Special Enrollment Period (SEP) if they experience certain life events such as moving to a new area or losing employer-sponsored health insurance. They can also enroll in a Medicare Advantage plan during the Annual Enrollment Period (AEP), which runs from October 15 to December 7 each year.
When selecting a Medicare Advantage plan, consider not only the monthly premium but also the availability of specific hospitals and doctors, the plan’s list of reimbursed drugs (formulary), and other benefits offered. Medicare Advantage plans are popular due to their affordability and are offered in selected regions within individual states. They may not be available in all counties, with the richest offers being found in large urban areas and their surrounding counties. As of 2023, over 50% of people enrolled in Medicare choose Medicare Advantage plans. When choosing a Medicare plan, consider all forms of insurance, including Medicare Advantage.