What Medicare Doesn’t Cover
Private, Medicare-approved insurance companies offer Medicare Advantage (Part C) plans. Medicare compensates these companies for providing your Part A and Part B coverage. Plan members get the same coverage as Original Medicare, with added benefits which can include prescription drug coverage, dental, hearing, and vision plans. The prescription drug coverage offered by many Part C plans is comparable to Medicare’s Part D prescription drug plans, which are offered separately from Part A and Part B.
Medicare Advantage Plans
Private, Medicare-approved insurance companies offer Medicare Advantage (Part C) plans. Medicare compensates these companies for providing your Part A and Part B coverage. Plan members get the same coverage as Original Medicare, with added benefits which can include prescription drug coverage, dental, hearing, and vision plans. The prescription drug coverage offered by many Part C plans is comparable to Medicare’s Part D prescription drug plans, which are offered separately from Part A and Part B.
Coverage with Medicare Advantage
Under a Medicare Advantage plan, you have hospital and medical coverage equal to Part A and Part B. Hospital insurance covers inpatient care in a hospital or skilled nursing facility, as well as hospice and home health care. Medical insurance covers medically necessary and preventive services. This can include clinical research, ambulance services, durable medical equipment, mental health care, and limited outpatient prescription drugs.
Prescription drug coverage with a Medicare Advantage plan works just like coverage under a Part D prescription drug plan. The plan will cover at least two drugs in each of the most commonly prescribed therapeutic categories. Nearly all drugs in six categories are covered: anticancer, anticonvulsants, antidepressants, antipsychotics, antiretrovirals, and immunosuppressants.
Medicare Advantage plans have a vested interest in your health. Some plans will offer discounts for fitness center memberships to help you stay as healthy as you can.
Medicare Advantage Costs
Costs under Medicare Advantage plans include premiums, deductibles, and copayments. Many plans have a monthly premium as low as $0. While your Medicare Advantage plan is billed for your expenses, you still need to stay enrolled in Part A and Part B. That means you have the Part B premium to pay, with the standard premium amount of $148.50 in 2021. This premium amount is dependent on your income. If you make more than $88,000 as an individual or $176,000 as a married couple, you will pay a higher monthly rate to Medicare charged as an Income Related Medicare Adjustment Amount (IRMAA). Some Medicare Advantage plans will pay all or part of your Part B premium.
Medicare Advantage plan deductibles are yearly expenses that you pay only once as part of your out-of-pocket expenses. Payments made for covered services go toward the deductible. You can check with your plan’s benefits manager to confirm whether a service, test, or item will go toward your deductible.
Once you have paid your yearly deductible, your plan will begin to cover its portion as stated in your policy’s benefits. You will be expected to pay copayments of $10 or $20 every time you visit a doctor, with higher copayments for seeing a specialist or visiting the emergency room.
Many Medicare Advantage plans have networks of contracted healthcare providers. Plan members pay less for services received from providers within the plan’s network. Some plans will not cover services received outside of the network, and other plans may charge you more for services from providers outside of your network. Check with your plan before you go to a healthcare provider outside of your network to see how much you will be expected to pay
Advantages Compared to Original Medicare
Original Medicare has no maximum for out-of-pocket expenses. To demonstrate the impact of this, consider Part A. Medicare’s hospital insurance has a deductible that applies for each benefit period. Benefit periods begin when you are admitted as an inpatient and ends after 60 days go by without you
receiving inpatient healthcare services. The danger in this is that you can have multiple benefit periods within the same year. The average inpatient hospital stay is shorter than five days, so there is potential for you to have to pay this deductible as many as five or six times.
All Medicare Advantage plans have out-of-pocket maximum limits to keep your costs low. Once you have paid that maximum amount, your insurance will cover your healthcare expenses for the rest of the year.
Medicare Advantage plans can have premiums as low as $0, which you will pay in addition to your Part B premium. Your cost-sharing may also be low in Part C plans. Medicare Advantage plans often have set payment amounts for copays, such as $20 for doctor visits and $50 for emergency room visits. These costs can be lower than the 20% coinsurance you would pay under Original Medicare.
Networks under a Medicare Advantage plan can coordinate your care. Most Medicare Advantage plans have networks of contracted healthcare providers, and some require you to have a primary care physician or care coordinator to help manage your healthcare. Some plans have medication therapy management as part of their prescription drug coverage, which can be a helpful addition.
These plans are also convenient because of their combination of coverage. One plan can take care of your hospital, medical, prescription drug, dental, hearing, and vision coverage. Having one company administer these benefits can be a good way to simplify your healthcare.
Types of Medicare Advantage Plans
There are a few different types of Medicare Advantage plans. These include HMOs, PPOs, PFFSs, MSAs, and SNPs.
Health Maintenance Organization (HMO) plans require you to receive your healthcare from providers within the plan’s network unless you require emergency care, out-of-area urgent care, or out-of-area dialysis. Members of HMO plans are required to have a primary care physician from the network and receive a referral to see a specialist. Your plan may require prior approval for certain services. Certain screenings and preventive services do not require a referral, such as mammograms. HMO plans with a point-of-service option may allow you to receive certain services outside of your network, but it will usually cost less to receive care within the network. Under an HMO, you may owe the full cost for services outside of the network.
Preferred Provider Organization (PPO) plans are more flexible than HMO plans, allowing you to see providers outside of the network at a higher cost. Your premiums for a PPO may be higher for this reason. You do not need a primary care physician and, in most cases, do not need a referral to see a specialist. Seeing specialists in the plan’s network will result in lower costs.
Private Fee-for-Service (PFFS) plans do not always have networks, but seeing providers within the network may allow you to save money. Under a PFFS plan, you can go to any provider who accepts your plan’s payment terms and agrees to treat you. You do not need a primary care physician or referrals to see a specialist. In the case of an emergency, healthcare providers must treat you. Out-of-network providers from whom you have received care in the past may decide not to treat you, and providers you have never seen before may agree to treat you. Providers have the choice to agree to treat you or not at every visit. Show them your PFFS card each time you visit.
Medicare Medical Savings Account (MSA) plans have two parts. They have a high-deductible health plan and a Medical Savings Account, similar to Health Savings Account plans you would find in the private marketplace. Once you meet the high yearly deductible, your plan will begin to cover your healthcare costs as outlined in the plan’s benefits. Some MSA plans offer additional benefits at extra costs, such as dental, hearing, and vision coverage or long-term care. MSA plans do not charge a premium but do not include prescription drug coverage. Unlike other Medicare Advantage plans, you can enroll in a separate Part D plan to get prescription drug coverage if you have an MSA plan.
Special Needs Plans (SNP) plans are designed to care for the needs of their members, who fit certain characteristics or meet qualifying criteria to be eligible for the plan. All SNPs provide prescription drug coverage. There are three different types of SNPs, based on how you qualify. Chronic Condition SNPs (C-SNPs) care for the needs of people who have qualifying chronic conditions or pairings of comorbid conditions. Dual-Eligible SNPs (D-SNPs) are for people who qualify for both Medicare and Medicaid. There are several different programs under Medicaid, and your state may limit the eligibility to certain programs. Institutional SNPs (I-SNPs) are for people who are living in an institution, such as a skilled nursing facility and are receiving an institutional level of care. This level of care is assessed by an independent third party. SNPs have networks of specialists to care for the conditions or needs of their members, including specialists in the treatment of conditions for C-SNPs.
Eligibility for Medicare Advantage
If you are enrolled in Medicare Part A and Part B and live in the service area of the plan you want to join, you can enroll in a Medicare Advantage plan. A general applicant can enroll in an HMO, PPO, PFFS, or MSA. If you meet the criteria to enroll in an SNP, you can choose to enroll in one. People with End-Stage Renal Disease (ESRD) can enroll in a Medicare Advantage plan as of January 2021.
Enrolling in Medicare Advantage
To join a Medicare Advantage plan, you can enroll in a plan during your Initial Enrollment Period. This is the seven month stretch around your 65th birthday for American seniors. People qualifying due to a disability can join in the seven months surrounding their 25th month of receiving disability benefits from Social Security or the Railroad Retirement Board. If you do not have Part A but enrolled in Part B during the Part B Open Enrollment period from January 1 to March 31, you can join a Part C plan from April 1 to June 30. The same time period applies to people who have only Part A and not Part B.
The time to switch from Original Medicare to a Medicare Advantage plan is during the Open Enrollment Period, which spans from October 15 to December 7 of each calendar year. During this time, you can:
- Switch from Original Medicare to a Medicare Advantage plan
- Return from a Medicare Advantage plan to Original Medicare
- Switch from one Medicare Advantage plan to another Medicare Advantage plan
- Switch from a Medicare Advantage plan without drug coverage to a Medicare Advantage plan with drug coverage
- Switch from a Medicare Advantage plan with drug coverage to a Medicare Advantage plan without drug coverage
The Medicare Advantage Open Enrollment Period, which goes from January 1 to March 31, is available for people who are already in Medicare Advantage plans to make changes. During this time, you can:
- Switch to another Medicare Advantage plan
- Drop your Medicare Advantage plan and return to Original Medicare. You can also add a prescription drug Part D plan
Medicare Advantage plans can be a good all-in-one option for your healthcare coverage. Speak with the experts at Medicare Peace of Mind to determine whether a Medicare Advantage plan is right for you.
