Medicare Advantage Plans, also known as Part C, are offered by Medicare Advantage organizations with a Medicare contract. This is an alternative way to receive Medicare benefits through an insurance company that has a contract with Medicare to coordinate your care. These plans are popular due to their low monthly premiums and extra benefits. These plans are different than Original Medicare.

To enroll in Medicare Advantage, you must have Medicare Part A and Part B and live in the plan’s service area. These calendar year plans run from January 1st thru December 31st each year.

The Benefits of Medicare Advantage:

Low Monthly Premium: Medicare Advantage plans typically offer lower monthly premiums.

Maximum Out Of Pocket Limit: Medicare Advantage plans have a yearly limit on what you pay out of pocket for your hospital & medical coverage. These maximums vary from plan to plan. If you reach your plan’s annual out-of-pocket maximum (MOOP), the plan covers the rest of your expenses provided you have worked with providers according to the plan’s rules. Your monthly premium and prescription drug co-pays do not count toward this maximum.

Part D – Prescription Drug Plan included: Most will include a Part D plan with no additional premium.

Additional Benefits: Many plans include benefits beyond what Medicare offers such as a gym membership, dental and vision coverage, a hearing aid benefit, & a quarterly OTC benefit. The dollar amount of these benefits varies from plan to plan.

The Drawbacks of Medicare Advantage:

Co-Pays & Co-Insurance: Medicare Advantage plans have set co-pays & coinsurance for services as you use them. Some services charge co-insurance which is a percentage of the cost of a service, for example, 20% coinsurance. Think of it like a menu where you pay $x amount every time you seek care. Every payment you make for in-patient and out-patient medical care is credited to your plan’s maximum out-of-pocket. If you reach it, the plan pays for the rest according to the plan agreement. Services received must be medically necessary and Medicare approved procedures. Any prescriptions you administer to yourself at home are not included in your Medicare Advantage/Part C plan’s maximum-out-of-pocket.

Networks: Similar to employer coverage, Medicare Advantage plans require you to stay within their network of doctors and hospitals, unless it’s an emergency. Going out of network will result in you paying higher costs or even 100% of the costs, depending on which plan you choose.

Catastrophic Coverage: Medicare Advantage plans limit your annual maximum out-of-pocket. That still amounts to a large sum of money many people simply don’t have budgeted for their healthcare. It is especially expensive when someone gets sick towards the end of the calendar year because their maximum out-of-pocket limit resets every January 1st. 

Coverage for Cancer – Typically Medicare Advantage plans charge 20% coinsurance for chemotherapy and infusions received in an out-patient setting.