There’s a lot of confusion surrounding what Medicare Advantage (which is sometimes called “Part C”) is compared to the plain old “Original” Medicare. Let’s clear up that confusion.
What Is Medicare Advantage?
Medicare Advantage was introduced by the federal government in 1995. It was created to give people more options when it comes to their health care insurance. Medicare Advantage is regulated by the federal government. However, the plans are sold by private health insurance companies. Every plan that Medicare Advantage offers has at least the same benefits as both the original Medicare Parts A and B.
How Much Do Medicare Advantage Plans Cost?
With Medicare Part A, most people do not pay a monthly premium. That’s because you’re been paying for it through your paychecks during your career. For Medicare Part B there are usually premiums. The cost of these premiums vary based on your income level.
Medicare Advantage plans also carry a monthly premium. Depending on the type of plan you want, you may very likely find a plan with a $0 premium. Premiums for Medicare Advantage plans can go as high as $300 – $400 per month depending on the plan you choose and the state you live in. However, according to the Centers for Medicare & Medicaid Services, in 2019 the average Medicare Advantage/Medicare Part C monthly premium is just $28.
Coverage and Out of Pocket Limits
Though Medicare Advantage plans offer more coverage than the original Medicare. For instance, if the Original Medicare covers medical and hospital costs, Medicare Advantage also can cover dental, vision, hearing and prescription drugs. Additionally, Medicare Advantage has an annual out-of-pocket limit. This means that once you reach a certain dollar amount, the Medicare Advantage plan pays 100% of the cost for most services covered. The Original Medicare does not have a cap on what you may pay out of pocket.
Copays and Coinsurance
Another difference is related to coinsurance and copay. For example, Medicare Part A has copays. It’s basically a set amount you will pay for certain types of health care services. Medicare Part B has coinsurance. This is where you pay 20% of the Medicare approved cost of your treatment (after you’ve met your deductible). On the other hand, a Medicare Advantage plan can have a $15 copay when you see the doctor. That means that no matter how much a doctor visit costs your health insurance company, you are required to pay $15 every time you go.
What Health Care Providers You Can See
Moreover, when it comes to networks, Original Medicare allows you to go to any doctor or facility that accepts Medicare. Medicare Advantage plans, on the other hand, have fixed networks of doctors and hospitals which you have to go to.