Senior News

Medicare Advantage Plans Vs. Original Medicare

We have had a lot of questions about Medicare Advantage Plans. Advantage plans advertise on TV. What catches senior’s attention is Advantage Plans saying they have zero premium or saying they cover dental, vision, hearing, gym memberships, money back and food cards. All incentives to attract new clients.

A Medicare Advantage Plan is another way to get your Medicare Part A and Part B coverage. Medicare Advantage Plans, sometimes called “Part C” are offered by Medicare-approved private companies that must follow rules set by Center for Medicare and Medicaid. Many Medicare Advantage Plans include drug coverage (Part D). There are several types of Medicare Advantage Plans. Each Advantage Plan has special rules about how you get your Medicare covered Part A and B services and your plan’s supplemental benefits. If you join a Medicare Advantage Plan, you will still have Medicare, but you will get most of your Part A and Part B coverage from your Medicare Advantage Plan. You must use the card from your Medicare Advantage Plan to get your Medicare covered services. Keep your red, white and blue Medicare card in a safe place because you still need it.

How do Medicare Advantage Plans work?

When you join a Medicare Advantage Plan, Federal Medicare pays a fixed amount to your Advantage plan as it is a Medicare substitute which is simply managed by private insurance companies. In contrast, Original Medicare is run by the federal government. Think of it as choosing between ordering a meal (Medicare Advantage) at a restaurant, where the courses are already selected for you, or going to the buffet (original Medicare), where you must decide for yourself what you want.

If you elect to go with original Medicare, your buffet will include Part A (hospital care), Part B (doctor visits, lab tests and other outpatient services) and Part D (prescription drugs). If you decide to go with Part C, a Medicare Advantage plan, it will be more like a set menu, since a private insurer has already bundled together parts A and B and usually part D into one comprehensive plan. Some aspects of your care will be constant whichever plan you choose. Under both choices, any preexisting conditions you have will be covered and you will also be able to get coverage for prescription drugs.

There are crucial differences to consider before changing from Original Medicare to an Advantage plan.

Can you pick your provider?

Under Original Medicare, you can choose any provider such as your primary care doctor and specialists who accept Medicare. You do not need to obtain a referral to see any medical provider and you do not have to worry about your doctor leaving a plan’s network. That means chances are pretty good that any doctor you are currently seeing will accept Medicare and you will not have to change providers. But be aware that if you are looking for a new physician, 30 percent of primary care doctors are not taking new Medicare patients, so you will want to ask about that. Your pharmacy plan can be reviewed annually during open enrollment to suit your location, pharmacy of choice and medications so your insurance is specifically tailored for you. During Open Enrollment, Oct. 15 through Dec. 7 of each year people on Original Medicare or on an Advantage Plan without drug coverage bundled in it can have their Part D plan reviewed and updated to ensure their medications are covered and cost kept to a minimum.

Under Medicare Advantage, you will be joining a private insurance plan similar to what you had through your employer. The most common ones are health maintenance organizations and preferred provider organizations. Medicare Advantage employs managed care plans, and, in most cases, you would have a primary care physician who would direct your care, meaning you would need a referral to a specialist. HMOs tend to have more restrictive choices of medical providers than PPOs.

If your Advantage plan covers Part D, you must utilize the plan they choose thus it may not be tailored to meet your needs. If it does not include part D, you must obtain one yourself. Often one can save money buy having an Advantage plan without drug coverage. For example, one Advantage plan has premium of over $80 added for the drug coverage when one may purchase their own under $40. If the Advantage plan’s part D does not cover your medications, your copays will be much greater as well.

What services are offered?

Under Original Medicare, you can get a wide variety of medical services including hospitalizations; doctor visits; diagnostic tests, such as X-rays and other scans; blood work; and outpatient surgery. While Medicare will cover most of your medical needs, there are some things it typically doesn’t pay for such as cosmetic surgery, routine dental or vision and hearing care.

Under Medicare Advantage, you will get all the services you are eligible for under Original Medicare. In addition, some MA plans offer care not covered by Original Medicare. These include some dental, vision and hearing care. Some MA plans also provide coverage for gym memberships. The services that are available varies by plan, often the coverage of dental, vision and hearing is minimal or provided at an additional cost. Keep in mind there may be no providers in your area who are part of the network so you may pay more out of pocket or the entire cost yourself.

What are the costs?

Under Original Medicare, the federal government sets the premiums, deductibles and coinsurance amounts for Part A (hospitalizations) and Part B (physician and outpatient services). For example, under Part B, beneficiaries are responsible for 20 percent of a doctor visit or lab test bill. The government also sets maximum deductible rates for the Part D prescription drug program, although premiums and copays vary by plan. Many beneficiaries who elect original Medicare also purchase a supplemental or Medigap policy to help defray out-of-pocket costs.

Under Medicare Advantage, enrollees must still pay the government-set annual Part B premium (in 2025 it will be $185.00 for the average plan if you do not have a late enrollment penalty or an Income-Related Monthly Adjustment and sometimes an additional premium for the MA plan. But instead of paying the 20 percent coinsurance amount for doctor visits and other Part B services, most MA plans have set copay amounts for a physician visit. MA plans have an annual cap on out-of-pocket expenses to protect you. In 2025, this was increased to $9,350 although some plans may have a lower cap. Note: Since you cannot have a supplement (Medigap) policy with an Advantage plan, should you switch from Original Medicare to an Advantage plan and drop your supplement policy you might not be able to get it back should you return to Original Medicare.

You should check if you are eligible for Medicaid or any of the other assistance programs Medicare offers to low-income enrollees. Both Original Medicare and Advantage plans will collaborate with people who are on these programs.

To summarize, under Original Medicare, to get the full array of services you will likely have to enroll in four separate elements: Part A; Part B; a Part D prescription drug program; and a supplemental or Medigap policy. Physicians and hospitals must file claims for each service with Medicare that you will have to review.

What is the largest downside to Advantage plans?

Under Original Medicare, you can access care anywhere in the United States if the provider accepts Medicare.

Medicare Advantage plans are based around networks of providers that are usually self-contained in a specific geographic area, zip codes are used to verify your address. So, if you travel a lot or have a vacation home where you spend a lot of time, your care may not be covered if you go to out-of-network providers, or you would have to pay more for care. In addition, while MA plans are available throughout the United States, the choice of plans is more limited in rural areas. If you are on an Advantage Plan and move, you must notify your plan of the move. If you are moving out-of-network, you will lose your plan and either must find a new MA in the area you are moving or go on Original Medicare and hope you can obtain a Supplement or have Medicare Secondary Payor acting as your supplement.

Advantage plans are most suitable to low use healthy clients who have access to network providers.

Neither original Medicare nor Medicare Advantage covers your health care abroad.

It is always wise to contact your provider to find out if they are in the plan’s network before making any changes. Keep in mind that same goes for providers of dental and vision services. Rural Montana has its challenges and access to Advantage plan networks is one of them.

Your area State Health Insurance Program counselor is available free of charge to assist you with information on what is best for your area: call 1-800-551-3191 to locate your area SHIP counselor.