Choose Medicare Advantage Plan that is right for you
During the annual open enrollment period, Medicare beneficiaries are faced with a choice to stay with the coverage they have or to make a change.
For those who still use an employer sponsored plan as their secondary coverage the choice is usually a relatively easy one, stay with the coverage they have. But, for many, including those who are just becoming eligible for Medicare the choice is not an easy one.Do I choose Original Medicare and enroll in a separate Part D drug plan or do I enroll in a Medicare Advantage Plan?
Original Medicare and a Part D plan. Original Medicare refers to benefits covered under Part A (hospital insurance) and Part B (medical insurance). If you have this coverage you carry a blue Medicare card. In addition, you need a separate Part D (prescription drug) plan. During open enrollment, every fall you have an opportunity to change your Part D plan or switch over to Part C plan, more commonly called Medicare Advantage Plans (Advantage Plan).
If you have an Advantage Plan, there are also special enrollment periods during the year that allow you to return to Original Medicare coverage. The remainder of this article will focus on Advantage Plans which combine Original Medicare and a Part D plan along with an array of additional benefit options.
How do Medicare Advantage Plans work? Advantage Plans are offered by private insurance companies that are approved by Medicare. Your blue Medicare and prescription drug coverage cards are replaced by a single, Advantage Plan card. Medicare pays these companies a fixed amount to cover the cost of care they provide. Advantage plans come in all shapes and sizes. Many cover your prescription drugs as well as many services not covered by Original Medicare.
The benefits of choosing a Medicare Advantage Plan. First, many like the convenience of an Advantage Plan. If you choose a plan that also pays for your prescription drugs, you deal with only one company. Second, Advantage plans offer additional benefits that are not covered under Original Medicare. Keeping in mind that not all plans offer the same set of additional benefits, here are some of the coverage options offered:
Dental benefits. These are available either as a value-added service (part of the standard premium) or as an additional paid benefit.
Vision benefits. As with dental benefits, vision plans can either be a value-added service or an additional paid benefit.
Hearing aid coverage. Again, this is either a value-added or additional premium option.
Gym memberships. Some plans offer Silver Sneakers or other fitness programs as part of the plan. This is a benefit that is very popular, especially with younger beneficiaries.
Skilled nursing home stays. Some Advantage Plans allow their members to stay in a skilled nursing facility without having a normal three-day Medicare qualifying stay in a hospital. This stay must be approved by a primary care physician.
Medical transportation. Some Advantage Plans offer transportation benefits by providing assistance getting to and from the provider’s office or in picking up your prescriptions. Original Medicare does not provide transportation to and from the physician’s office. If you are unable to drive, or need some assistance, you will have to pay for this out of pocket, or have a family member assist you.
Maximum out of pocket limits. Many Advantage Plans limit the amount of out of pocket expenses you will incur when you have a serious medical condition.
The downside of Advantage Plans. Because Advantage plans are administered by private insurance carriers, the rules vary from one plan to the next. This can result in restrictions, such as (1) higher out of pocket costs, (2) not being able to choose your doctor (especially specialists) that are out of the plan’s network and (3) nonrenewal of contracts.
Drawing on the work of the Medicare Rights Center, here is a list a number of possible factors that many might view as disadvantages to Advantage Plans when compared to Original Medicare.
Advantage Plan rules. Your plan sets the rules for co-pays and deductibles. If you don’t follow their rules you may be charged for the full cost of your care.
Medigap policies. Many who use Original Medicare purchase so-called Medigap (supplemental) insurance policies to cover co-pays and other deductibles. Beneficiaries who are covered by Advantage Plans are not permitted to purchase such plans to cover out-of-pocket expenses.
Out of network coverage. If you are covered by Original Medicare, you can generally go to any doctor or hospital in the U.S. that accepts Medicare and you will be covered. This is usually not true if you have an Advantage Plan. Typically, such plans have local networks of providers that you must use for the plan to cover your care.
Specialist referrals. Under Original Medicare you do not need a referral to see another provider or specialist for your care to be covered. However, Advantage Plans usually require you to get a referral from your primary care physician in order for the plan to cover your visit to a specialist.
Out-of-pocket spending limits. With Original Medicare, there is no cap on what you spend on health care. Advantage Plans have an out-of-pocket spending limit, which can be high. However, you are usually protected if you need expensive care. With Original Medicare, the purchase of a Medigap plan will cover the majority of these out-of-pocket expenses.
Answers to your questions about Medicare Advantage Plans are available year-round. If you are considering making a change in your coverage, it is never too early to start looking at your options. The Oneida County Office for the Aging/Continuing Care/NY Connects Health Insurance Information, Counseling and Assistance Program (HIICAP) is ready every day to help you in understanding and considering your options. The Original Medicare or Advantage Plan decision is an important one. To reach a trained counselor, call the HIICAP program at 315-798-5456.
Dr. William Lane is the owner of William Lane Associates, a gerontological firm which is now located to Homer, NY. He is writing a monthly column on issues related to health insurance for the OFA. Dr. Lane does not sell insurance, work for any insurance company or recommend any insurance products.