What is a Medicare Advantage Plan?
Medicare Advantage Plans, sometimes called "Part C" or "MA or MAPD Plans," are a type of Medicare health plan offered by private insurance companies approved by Medicare. Medicare pays a fixed amount each month to the insurance companies who are administering these plans. Medical claims for Part A and Part B services are submitted to the Plan for payment, rather than directly to Medicare.
Medicare Advantage Plans cover all services that Medicare covers, and may also offer extra coverages. Many Medicare Advantage Plans also cover prescription drugs, so you do not require a separate Part D plan. In fact, enrolling in a separate prescription drug plan will normally cause an automatic disenrollment from your Medicare Advantage Plan.
Some Medicare Advantage Plans also offer routine dental, vision and hearing services; as well as 24-hour nurse hotlines, fitness memberships and chronic conditions care management services.
Unlike original Medicare and traditional Medicare supplements, Medicare Advantage Plans have networks; such as preferred provider organizations, Private Fee for Service and Health Maintenance Organizations (PPOs, PFFS, and HMOs). It is important to know what type of plan you are enrolling in as seeing a doctor outside of the Plan’s network could result in higher out of pocket expenses, and sometimes will result in no coverage at all.
Medicare Advantage Plans may also have different rules for how you get services, like whether you need a referral to see a specialist or need a prior authorization for certain prescription drugs.
Costs Associated with a Medicare Advantage Plan
Under original Medicare, you pay a Part B premium, which is usually automatically deducted from your social security check – for 2015 it was $104.90. In order to sign up for a Medicare Advantage Plan, you must be enrolled in Part A and B of Medicare; and will still pay this Part B premium.
Also under original Medicare, Medicare usually covers 80% and you pay the remaining 20%. What often makes a Medicare Advantage Plan attractive is the annual out-of-pocket maximum limit. This is an important protection for Medicare beneficiaries.
Medicare Advantage Plans charge a monthly premium, which varies by what area you reside in. These premiums are often lower than what you would pay for a traditional Medicare Supplement; however, in exchange for a lower premium, you will be asked to pay copayments, coinsurance and deductibles for each medical service you receive.
Who Can Enroll in A Medicare Advantage Plan?
· Anyone 65 years of age or older
· Anyone who is under the age of 65 and on Medicare disability
· You must have Parts A and B of Medicare
· You must live in the Plan’s service area
· You cannot have End Stage Renal Disease (ESRD)
When Can I Enroll?
· During the Initial Coverage Election Period(ICEP) – The seven month period when you are first eligible for Medicare (Three months before, the month of and three months after)
· During the Annual Election Period (AEP) – October 15 – December 7 each year
· During a Special Election Period (SEP) – There are certain circumstances that will allow enrollment into a Medicare Advantage Plan outside of the first two enrollment periods, a few examples are: Moving into a new service area, going in or out of a nursing home, receiving or losing extra help, or involuntarily losing employer coverage
A Medicare Advantage Plan is one option that a Medicare beneficiary has. It is important to understand how these plans work before making the decision to enroll. An experienced Medicare Insurance agent should be able to explain the differences between traditional Medicare, Medicare Supplements and Medicare Advantage Plans so that you can make the right decision for you.