What is Medicare Advantage?

Breakdown of Medicare Advantage for Seniors

by Amy De Vore+ on Jun 23, 2014 | 2 Comments

Medicare Advantage (MA) is offered by a private company that is contracted through Medicare to provide seniors with Part A and Part B benefits. These plans are usually HMOs or PPOs, but can also be a Private Fee-for-Service Plan, Special Needs Plan, or Medicare Medical Savings Account Plan.

How do Medicare Advantage Plans Work?

Medicare Advantage plans replace Original Medicare in the following ways:

  • Medicare Advantage must follow Medicare’s rules
  • Medicare Advantage plans are local, HMO/PPO type networks
  • Medicare pays toward your care each month to your chosen provider of Medicare Advantage plans
  • Medicare Advantage plans can charge different out-of-pocket costs for services depending on provider and plan
  • Although MA must follow Medicare’s rules, these plans may set up how you receive services**
  • Most MA plans offer prescription drug coverage
  • You cannot have Medigap and Medicare Advantage at the same time

**Each Medicare Advantage plan may set up its own way of how your receive services, such as if you need a referral for a specialist and if you have to stay in network. You will need to check with your provider to see how your plan works for you.

Medicare Advantage Pros and Cons

Medicare Advantage plans, like most things, have pros and cons. Let’s go over the positives first:

Medicare Advantage Pros

  • Medicare Advantage allows for seniors to pay one monthly premium for all services
  • MA plans can have the least expensive premiums (sometimes even a $0 premium)
  • Many MA offer extras like dental, vision, gym memberships, and Rx coverage
  • Medicare Advantage has open enrollment every year where you can change your plan
  • MA plans have an out-of-pocket max, usually $6,700 per year
  • Some Medicare Advantage Plans cover emergency services worldwide

Medicare Advantage Cons

  • Local HMO/PPO type network
  • To see a doctor outside of your network may cost you 100% of charges
  • Co-payments may be due each time you seek medical services
  • Often each MA plan will have gaps in coverage
  • Each plan is slightly different which makes them hard to compare
  • Many plans have deductibles

Why Choose Medicare Advantage?

Medicare Advantage offers a lot of benefits at a low-cost. These plans are inexpensive, basic plans, that can limit your out of pocket costs, as long as you read the fine print, are okay with copays that can add up and a limited network, this might be the right fit. If you have further questions call the number above or contact Senior65.



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Reader Comments and Questions

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By Leviticus Bennett on March 24, 2017

That's nice that medicare advantage plans offer extras for least expensive premiums. I'm going to help my grandparents choose a medicare plan, so I'm trying to do my research. My grandparents would love a plan that gets them a gym membership, so I'll keep in mind this type of plan.

By marianne on December 22, 2016

One more question re Medicare Advantage plans (HMO) Does the maximum out of pocket include out of network procedures/doctors? Thank you!

Medicare Advantage HMO plans out of pocket maximums only count toward in-network providers -as HMOs do not cover any out of network services. If you want a plan that covers both you will want to consider a PPO. If you need help finding a PPO plan in your area call one of our Senior65 licensed independent insurance agents at 800-930-7956.
-Chris from https://www.senior65.com/

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