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Medicare Advantage vs. Medicare: What Are the Differences?

Jan 10, 2020 3 min read Ben Gran

When you sign up for Medicare, there are a few different plan options, and they offer different coverage and benefits. Most people get "Original Medicare," which includes Medicare Part A (hospital care and some types of inpatient care) and Medicare Part B (doctor visits and routine health tests and screenings). There is also Medicare Part D, through which you can choose a prescription drug plan.

But even with all of these different types of Medicare coverage, some people might want a different form of Medicare. This is known as Medicare Part C, or "Medicare Advantage." With Medicare Advantage, your costs and coverage options might be slightly different in a way that works better for you. But it's important to understand the details involved before you choose a Medicare Advantage plan.

 

 

What is Medicare Advantage?

With Medicare Advantage, you still get the same benefits as Medicare Part A and Part B, but you can also get additional coverage like Part D prescription drug coverage as well as extra services like dental, hearing and vision benefits that aren't included with Original Medicare.

Medicare Advantage is run by private insurance companies, and you pay a monthly premium to the insurance company in addition to the premium you pay for your Medicare Part B plan. Exact prices and coverages depend on where you live and what kind of Medicare Advantage plan you choose.

Learn more about what care and benefits are not covered by Medicare Parts A and B. Opens in new window

 

How to compare Medicare Advantage vs. Medicare

Depending on your health care needs and your overall financial situation, Medicare Advantage might be a better option than Original Medicare. However, there are a few key differences to keep in mind:

Network of providers: Medicare Advantage plans are often HMOs (health maintenance organizations) or PPOs (preferred provider organizations). HMOs require you to go to doctors and hospitals within your plan's network of providers, and PPOs require you to pay higher copays for out-of-network doctors and hospitals.

If you don't travel much and are confident that you can keep seeing doctors or visiting hospitals that are close to home and within the same network, a Medicare Advantage plan might help you keep your costs down.

But if you travel or split time between multiple homes or different states during winter and summer, a Medicare Advantage plan's network might not have enough flexibility.

Extra services and benefits: Original Medicare typically doesn't cover services like prescription drugs, dental care, hearing aid checks, vision care and other services. Medicare Advantage is a way to get coverage for all of these extra aspects of care with one plan. The costs of your Medicare Advantage premium might be higher than paying out of pocket on an as-needed basis for dental visits, but it can also give you peace of mind to know that your various medical, dental and vision needs are all covered.

Different from Medigap: Keep in mind that Medicare Advantage is not the same as Medigap coverage. They are two different, separate types of plans. If you have Medicare Advantage, you cannot use Medigap coverage. Medicare Advantage might require you to pay for certain out-of-pocket expenses that Original Medicare plus Medigap might not cause you to pay, so be aware of the possible costs before making your choice.

Depending on your situation, you might be able to save money by going with Original Medicare plus Medigap coverage instead of using Medicare Advantage. It all depends on your specific health situation, where you live and other factors.

Option to change your plan: Once you sign up for Medicare Advantage, your plan costs and details might change from one year to the next. During open enrollment (Oct. 15 to Dec. 7), you can choose to change to a different Medicare Advantage plan for the following year. If you choose not to keep using Medicare Advantage, you can also switch back to Original Medicare.

Your total out-of-pocket costs might be lower with Medicare Advantage, or you might be better off with Original Medicare plus Medigap. It all depends on your health status, your overall lifestyle and financial situation and where you live.

Learn more about what to know about Medicare Advantage plans Opens in new window. When you're ready to shop for plans, use the Medicare Plan Finder tool Opens in new window.

Footnotes

 

Ben Gran is a freelance writer based in Des Moines, Iowa. He writes about personal finance, public policy, financial services, technology, and business.

 

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