If you qualify to get Medicare benefits, you will automatically be enrolled into Original Medicare Part A and Part B. You will get your basic medical needs covered by these plans which includes hospitalization and outpatient services like doctor visits, lab tests etc. Prescription drug coverage is not included in these two parts. The premium for Part A is zero for most people and the premium for Part B will be about $134 in 2018. However, there are some benefits that are not covered by Original Medicare like, dental, vision or hearing and foreign travel medical emergency. Some benefits are very limited like long term care services costs.
These insurance plans which are also referred to as Medicare Part C, provide an alternative way of getting your Medicare benefits. Medicare Advantage includes all the benefits that are provided under Medicare Part A and Part B. These are sold by private insurance companies and not by the government.
The reason Medicare Advantage plans are preferred by many as a means of getting Medicare benefits is because, these plans give more than Original Medicare and sometime at the same cost. Some additional benefits included in Medicare Advantage plans are not there in Part A or Part B of Medicare. Some Medicare Advantage plans come with prescription drug coverage included with them.
Advantages of Medicare Advantage Over Original Medicare
Limit on maximum out-of-pocket expenses
Medicare Advantage plans have deductible amounts, but there is a limit on the maximum you have to pay during the year. After you meet that amount, all other services will be covered totally for the rest of the year. Though the amounts may vary but the maximum out-of-pocket for any Medicare Advantage plan is $6,700 per year. For Medicare Part A and Part B you have to keep paying the deductibles every time you take the services and there is no limit on that.
Wider Range of Coverage
Medicare Advantage plans offer coverage for vision care, dental care and hearing care along with long term care services like nursing home stay or assisted living facility. There are many different types of Medicare Advantage plans and you can choose a plan which serves you best. Original Medicare does not offer choice of benefits.
Coinsurance amount is limited
Original Medicare plans mostly charge a 20% coinsurance for all services which has to be paid every time. Medicare Advantage plans put a cap on this amount.
Less Expensive Option
In order to get the benefits that are not included in Original Medicare and to reduce the extra costs, you need to take Medigap plans and Part D plans. You could get the benefits of all these plans together from Medicare Advantage at the same cost or a lower cost.
Drawbacks of Medicare Advantage
Limited Network of Providers
Medicare Advantage plans work pretty much like private insurance plans. They have their designated network of providers and the member has to stay within this in order to derive maximum benefit. Original Medicare plans are not bound by any network of providers. Members do not need prior approval to visit specialists.
Unnecessary if You have Employer Given Coverage
If you are getting Medicare benefits while you still get employer-sponsored health insurance, Medicare Advantage will be unnecessary and too expensive.
You can decide if you will really get any advantage from Medicare Advantage plans by weighing the positive and negative aspects and matching them with your own requirements.