Medicare Advantage, also known as Part C, is an alternative way to receive Medicare benefits through a managed care organization. These plans are becoming increasingly popular due to their low monthly premium and extra benefits, but these come with tradeoffs that you need to be aware of.
Low Monthly Premium – Advantage plans typically offer much lower monthly premiums than you will find on a Medicare Supplement plan.
Maximum Out Of Pocket Limit – Original Medicare Part A & B have no limit on the maximum you can spend out of pocket. Thankfully, Medicare Advantage plans do have a yearly limit on what you can pay out of pocket for your hospital and medical coverage. These maximums average roughly $6,000, after which the plan will cover the rest. Note that the monthly premium and prescription drug co-pays do not count towards this maximum.
Part D – Prescription Drug Plan included – Most will include a Part D plan with no additional premium.
Additional Benefits – Many plans include additional benefits beyond what Medicare offers such as gym membership, dental and vision coverage, and more.
Co-Pays – Medicare Advantage plans have set co-pays for your services as you use them, think of it like a menu where you pay $x amount every time you go to the doctor and higher amounts per day in the hospital.
Networks – Similar to employer coverage, Medicare Advantage plans want you to stay within their network of doctors and hospitals. Going out of network will result in your paying a higher co-pay or 100% of the cost, depending on which plan you choose.
Catastrophic Coverage – Medicare Advantage plans limit your maximum out of pocket around $6,000 per year, but that still amounts to a large sum of money that 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 will reset on January 1.
Many people love the added benefits like gym memberships and the simplicity of having their drug plan built in.
Wondering if Medicare Advantage would be a good fit for you? Call us and let us help you compare all the Medicare Advantage plans in your area. In many states there are over 20 different plans, so its crucial to work with someone who can show you all of your options.
Sylvia Gordon, aka Medicare Mama, is an expert on all things Medicare and Social Security. She is the 2nd Generation here at The Medicare Family and has served on the advisory boards of major insurance companies like UnitedHealthcare®, Cigna, and Anthem. In her free time, she can be found taking care of her animals (dogs, goats, peacocks, chickens), and reading a good book. Learn More.
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