What exactly is a Medicare Advantage plan? What does it cover, and how is it different from Original Medicare or a Medicare Supplement plan?
The first thing to understand is that a Medicare Advantage plan is NOT the same thing as a Medicare Supplement. Medicare Advantage, technically speaking, is Part C of the Medicare program. As such, Medicare Advantage plans provide healthcare coverage mandated by the federal Medicare program. In other words, if Medicare says something must be covered, then the Medicare Advantage plan must also cover the treatment, test, therapy, etc. In many cases, an advantage plan can include Part D, which will cover your prescribed medications. Lastly, in order to join a Medicare Advantage plan you need to have Medicare Parts A and B in place, and live in the plans service area, which are defined as counties in each state.
In general, if you are an individual who would like to eliminate or dramatically reduce co-pays, deductibles, and out of pocket costs for doctors, specialists, and hospitals then you should NOT enroll into an advantage plan, but rather join a Medicare Supplement, such as Plan F or Plan G. These plans come with approximate premiums of $185-225/month, depending on the company and plan you choose. Again, paying this premium will mean an insurance company will cover the costs that Medicare has passed on to you. Remember, if you would like Rx coverage you need to purchase a Part D prescription plan, where premiums range from $15-100/monthly – most enrollees pay between $30-50/monthly. Remember, supplements no longer cover prescriptions! See the chart below to understand approximate monthly costs of a supplement and Part D coverage.
In terms of a Medicare Advantage plan, the monthly premiums in some cases can be dramatically lower than supplements, such as $0/month. Some plans have higher premiums, but generally an advantage plan should be much lower than the monthly costs of a supplement with a Part D drug plan. In exchange for the benefit of lower monthly premiums, you will have co-pays, deductibles, and co-insurance percentages to pay when you visit medical providers.
Examples of co-pay costs for Medicare Advantage plans will resemble the following:
|Primary Care Doctors||$0-20|
|Hospital Stays||$250-350 for days 1 thru 7|
|Cancer Treatments||20%, up to the plan’s max out of pocket|
Each plan decides what your co-pay or deductible will be for a given service. Some co-pays are very modest, like $0 for preventive care, while other co-pays can be significantly higher, like skilled nursing facility care or cancer treatment.
So, is Medicare Advantage the right type of plan for you?
Let’s take a look at the chart below outlining approximate monthly costs to you:
|Monthly Premiums||Medicare Supplement Plan F with Part D||Medicare Advantage with Part D|
|Part B (Standard)||$135||$135|
|Part C – Medicare Adv.||Not Applicable||$25|
|Part D||$35 + Co-pays||Included in Plan + Co-pays|
|Additional Out Pocket||$0||Annual co-pay amounts to be determined|
|Total Monthly Premiums||$390||$160|
Remember, you can only choose one column! Next, look at the bottom-line, monthly premiums for each scenario. These savings will vary from plan to plan, state to state, and county to county!
Your Blue Goose agent will explain your exact costs to you when you meet.Remember, you can only choose one column! Next, look at the bottom-line, monthly premiums for each scenario. These savings will vary from plan to plan, state to state, and county to county!
The difference in premiums is why many people choose the Advantage plan. Many folks cannot afford the supplement or cannot justify paying that premium, especially if two people are involved like a husband and wife. Bear in mind though that the Advantage plan will return those monthly premium savings in the form of co-pays. Each time you visit a doctor, specialist, or hospital expect to pay a co-pay, co-insurance or deductible. If you only go to the doctors 3 or 4 times a year, your annual costs could be less than $250 for the whole year. If you have a significant medical event, you could pay thousands. These co-pay costs will vary from year to year as you manage your health.
We urge you to highly consider making this decision alongside a Blue Goose agent. We take pride in taking a complicated subject like Medicare and simplifying it. Our goal is to place you in a position to make an informed decision that best suits particular healthcare needs and budget.
Call us, we know we can help!