What’s a Medicare Advantage Plan?
You can get your Medicare benefits through Original Medicare, or a Medicare-Advantage Plan (like an HMO or PPO). If you have Original Medicare, the government pays for Medicare benefits when you get them. Medicare-Advantage Plans, sometimes called “Part C” or “MA Plans,” are offered by private companies approved by Medicare. Medicare pays these companies to cover your Medicare benefits.
If you join a Medicare Advantage Plan, the plan will provide all of your Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance) coverage. This is different than a Medicare Supplement Insurance (Medigap) policy.
There are several different types of Medicare Advantage Plans
- Health Maintenance Organization (HMO) plans—In most HMOs, you can only go to doctors, other health care providers, or hospitals in the plan’s network, except in an urgent or emergency situation. You may also need to get a referral
from your primary care doctor for tests or to see other doctors or specialists. Preferred Provider Organization (PPO) plans—In a PPO, you pay less if you use doctors, hospitals, and other health care providers that belong to the plan’s
network. You usually pay more if you use doctors, hospitals, and providers outside of the network.
- Private Fee-for-Service (PFFS) plans—PFFS plans are similar to Original Medicare in that you can generally go to any doctor, other health care provider, or hospital as long as they accept the plan’s payment terms. The plan determines
how much it will pay doctors, other health care providers, and hospitals, and how much you must pay when you get care.
- Special Needs Plans (SNPs)—SNPs provide focused and specialized health care for specific groups of people, like those who have both Medicare and Medicaid, live in a nursing home, or have certain chronic medical conditions.
- HMO Point-of-Service (HMOPOS) plans—These are HMO plans that may allow you to get some services out-of-network for a higher copayment or coinsurance.
- Medical Savings Account (MSA) plans—These plans combine a high-deductible health plan with a bank account. Medicare deposits money into the account (usually less than the deductible). You can use the money to pay for your health care services during the year. MSA plans don’t offer Medicare drug coverage. If you want drug coverage, you have to join a Medicare Prescription Drug Plan. For more information about MSAs, visit Medicare.gov/publications to view the booklet “Your Guide to Medicare Medical Savings Account Plans.”
Who can join a Medicare-Advantage Plan?
You must have Medicare Parts A and B and live in the plan’s service area to be eligible
to join. People with End-Stage Renal Disease (permanent kidney failure) generally can’t join a Medicare-Advantage Plan.
How much do Medicare Advantage Plans cost?
In addition to your Part B premium, you usually pay one monthly premium for the services included in a Medicare-Advantage Plan. Each Medicare Advantage Plan has different premiums and costs for services, so it’s important to compare plans in your
area and understand plan costs and benefits before you join.
What do Medicare Advantage Plans cover?
Medicare Advantage Plans must cover all of the services that Original Medicare covers except hospice care. Original Medicare covers hospice care even if you’re in a Medicare-Advantage Plan. In all types of Medicare Advantage Plans, you’re always covered for emergency and urgent care. Medicare-Advantage Plans must offer emergency coverage outside of the plan’s service area (but not outside the U.S.). Many Medicare Advantage Plans also offer extra benefits such as dental care, eyeglasses, or wellness programs. Most Medicare Advantage Plans include Medicare prescription drug coverage (Part D).
In addition to your Part B premium, you usually pay one monthly premium for the plan’s medical and prescription drug coverage.
Plan benefits can change from year to year. Make sure you understand how a plan works before you join.