What is Medicare Advantage?

Also known as Part C, Medicare Advantage is offered by private insurers. If you choose a Medicare Advantage plan, your benefits are paid by this insurer - and not by Medicare.

The insurer covers the same benefits as Original Medicare (like hospitalization and physicians) and replaces those benefits. Medicare Advantage insurance may pay out higher benefits amounts for those services if you use an in-network provider.


The Additional Benefits

You might be wondering exactly why someone would want to enroll in Medicare Advantage.

Medicare Advantage's biggest differentiators are that:

  • It may pay out higher benefit amounts for the same services covered by Original Medicare, lowering out-of-pocket costs.
  • It often includes prescription drug coverage (MA-PD plans).
  • It sometimes includes extra benefits, like dental, vision and fitness.

Some additional Medicare Advantage need-to-knows include:

  • You must reside within the plan's service area.
  • Your Medicare Advantage plan will only cover yourself - your spouse must have his or her own plan.
  • You cannot select a Medicare Supplement plan if you choose to purchase a Medicare Advantage plan.

Medicare Advantage Plan Types

HMO and PPO are the most popular Medicare Advantage plan types. These plans have their own provider networks and you must use providers in those networks in order to collect the maximum benefits possible. If you go out of network, your costs may be higher.

For HMOs, you must use a provider in the plan's network in order to receive benefits. For PPOs, you can use providers that are either in or out of network. The benefits you receive will be higher if you stay in-network versus not in the network.

Keep in mind that HMO plans also have a referral process for seeing specialists.


The Costs

The insurance company, based on the level of benefits provided, sets the premium charged for Medicare Advantage.


Medicare Eligibility

For many, qualifying for Medicare simply means turning 65. But there are other eligibility requirements you should be aware of. Discover if you're eligible here.

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