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What Is The Difference Between Medicare Advantage And Regular Medicare
Original Medicare and Medicare Advantage offer the same Part A and Part B benefits, but they differ regarding healthcare provider network rules, prescription drug coverage, and the availability of additional benefits. According to the Kaiser Family Foundation (KFF), in 2020, approximately 39% of the 62 million people enrolled in Medicare opted for Medicare Advantage plans.In this article, we look at original Medicare and Medicare Advantage plans. We provide a comparison of the two options and explain the premiums that a person can expect to pay.We may use a few terms in this piece that can be helpful to understand when selecting the best insurance plan:Deductible: This is an annual amount that a person must spend out of pocket within a certain time period before an insurer starts to fund their treatments.Coinsurance: This is a percentage of a treatment cost that a person will need to self-fund. For Medicare Part B, this comes to 20%.Copayment: This is a fixed dollar amount that an insured person pays when receiving certain treatments. For Medicare, this usually applies to prescription drugs.Original Medicare is a government health insurance program that covers hospital and medical costs. It comprises Part A and Part B. Part A covers hospital costs. It includes inpatient care at a hospital, the care received in a skilled nursing facility while recovering from a health condition, and hospice care.Part B covers medical costs as an outpatient. It includes preventive care services, doctor visits, laboratory tests, durable medical equipment, and some home health services.There is limited cover for prescription drugs with original Medicare. However, a person can opt for a stand-alone Medicare Part D prescription drug plan.Learn more about original Medicare here.Private insurance companies that Medicare has approved administer Medicare Advantage plans. These plans are also known as Medicare Part C. The plans offer an alternative to original Medicare, combining the benefits of parts A and B and, usually, Part D. Many plans also offer coverage for wellness programs and vision, dental, and hearing care. There are four main types of Medicare Advantage plans, some of which have strict healthcare provider network rules.Following a new ruling, as of January 2021, people with end stage renal disease (ESRD) can choose to enroll in either an original Medicare or a Medicare Advantage plan. Prior to this date, these individuals were rarely able to enroll in a Medicare Advantage plan.Learn more about Medicare Advantage here.The table below shows the differences between the two different Medicare options.Medicare premiums vary in cost depending on an individual’s circumstances. Premium-free Part AIf a person or their spouse paid Medicare taxes for 40 quarters while in employment, they typically do not pay a premium for Part A. Medicare refers to this as premium-free Part A.Part AIf someone has to buy Part A coverage in 2021, they will pay up to $471 every month if they paid Medicare taxes for fewer than 30 quarters. Those who paid Medicare taxes for 30–39 quarters pay a 2021 monthly premium of $259.Part BMedicare bases this premium on a person’s income from the previous 2 years. The standard Part B premium in 2021 is $148.50 each month.Part DPeople wishing to include coverage for prescription medication may opt for a Part D plan, also known as a prescription drug plan. The monthly premiums for these plans vary. As with Medicare Advantage plans, private insurers administer Part D plans.The national base premium in 2021 is $33.06, which is 1% higher than the 2020 premium.Medicare AdvantageMedicare Advantage premiums vary depending on the selected plan. Some insurance companies offer zero-premium plans with higher out-of-pocket expenses. However, the KFF notes that among those who did pay a premium, the average Medicare Advantage monthly premium in 2020 was $63.People can compare Medicare Advantage plans using the find a Medicare plan tool on the government website.Here we look at some of the most frequently asked questions relating to original Medicare and Medicare Advantage coverage. Do Medicare Advantage plans replace original Medicare?It would not be accurate to say that Medicare Advantage replaces original Medicare, but Medicare Advantage plans are an alternative way to receive Medicare health coverage with possible extra benefits.Medicare rules state that Medicare Advantage plans must offer at least the same benefits as original Medicare. However, as private medical insurance companies administer the plans, they have the freedom to provide additional benefits that original Medicare does not offer.With Medicare Advantage, an individual still pays Medicare directly for their original Medicare premiums, but they may also have to pay a separate premium to the plan provider.How do I know whether I have original Medicare or Medicare Advantage?An individual can check their plan documentation, including their membership card, to confirm whether they have original Medicare or Medicare Advantage.Alternatively, they can access their policy information online at mymedicare.gov. Once an individual has logged in, their plan name displays, along with their enrollment status information.Another option is to contact Medicare at 800-633-4227. A customer service representative can provide the person with their plan information.Which is right for me?A Medicare plan that suits one person may not meet the needs of another person. The best plan for a person will depend on various factors and circumstances, including medical needs, finances, and location. It is important that individuals carefully assess each plan and find the one that offers them the best healthcare coverage for their situation.The State Health Insurance Assistance Programs (SHIP) National Network offers free and impartial advice to those who wish to discuss their health insurance plan options, including Medicare, in more detail.Private insurance companies administer Medicare Advantage plans as another option for people who receive Medicare benefits. People with a Medicare Advantage plan still receive their original Medicare benefits. Some people find that one option provides more significant cost savings than the other. The pros and cons of the different plans depend on an individual’s circumstances and location. Independent advice is available through a person’s local SHIP center.The information on this website may assist you in making personal decisions about insurance, but it is not intended to provide advice regarding the purchase or use of any insurance or insurance products. Healthline Media does not transact the business of insurance in any manner and is not licensed as an insurance company or producer in any U.S. jurisdiction. Healthline Media does not recommend or endorse any third parties that may transact the business of insurance.
Video about What Is The Difference Between Medicare Advantage And Regular Medicare
Original Medicare vs Medicare Advantage
Not sure if you should keep Original Medicare or go with Medicare Advantage? Don’t go anywhere. We’re going to compare them side-by-side, so you can make the best choice for you.
Original Medicare (0:26)
Medicare Advantage (0:40)
Original Medicare Pros vs Cons (1:01)
Medicare Advantage Pros vs Cons (1:41)
Doctor Visits (2:59)
Covered Services (3:35)
Cost (4:09)
Summary (5:12)
While there are many similarities between Original Medicare and Medicare Advantage, they’re actually quite different. With Original Medicare, your benefits are administered by the federal government and include Part A and Part B. Part A is your hospital coverage and Part B is your medical coverage. You pay into both of these parts during your working career through Medicare taxes.
With Medicare Advantage, your benefits are managed through a private insurance company. Medicare pays the Medicare Advantage carrier to administer your benefits for both Part A and Part B. When Medicare Advantage is administering your benefits, it’s known as Part C. These private insurance companies must follow the guidelines that the federal government sets in place.
Now that we’ve gone over the basic difference between the two, let’s go over the pros and cons.
Original Medicare Pros:
• Benefits are identical from person to person
• There are no copays, no waiting periods, and no pre-existing condition limitations
• There are no networks, meaning you can see any doctor that accepts Medicare
• Any out-of-pocket costs will be the same regardless of the provider you choose
•Your coverage will also travel with you across the United States
Original Medicare Cons:
• Both Part A and Part B come with a deductible and coinsurance
• No maximum out-of-pocket
• No coverage for prescription drugs
Medicare Advantage Pros:
• Some areas have plans with [ytb_des] premiums
• Some plans have a Part B give-back option
• Plans have an out-of-pocket maximum limit
• Can come with additional perks like dental, vision, and hearing benefits, gym memberships, and long-term care
• Many plans include coverage for prescription medications
Medicare Advantage Cons:
• Benefits are different from plan to plan
• You still need to pay your Part B premium
• Limited doctor networks and need for a referral to see a specialist
• High cost per service
• Plans do not travel with you
• Maximum out-of-pocket limit could still break the bank
Now that we’ve discussed the pros and cons of both, let’s go over how doctor visits, covered services, and costs work.
Doctor Visits on Original Medicare:
• When you have Original Medicare, you can see any doctor or specialist that accepts Medicare without needing a referral
• Plans don’t change annually, so you don’t have to worry about your doctor leaving the plan’s network
Doctor Visits on Medicare Advantage:
• Most plans are HMOs or PPOs and you’ll have a primary care physician to direct all your care – therefore, you’ll need a referral to see a specialist
• Physicians can leave the plan’s network at any time
Covered Services on Original Medicare:
• A wide range of services are covered
• Does not include coverage for routine dental, vision, or hearing care
Covered Services on Medicare Advantage:
• Includes coverage for the same services Original Medicare covers plus possible coverage for dental, vision, and hearing
Costs on Original Medicare:
• Part A and Part B both come with a deductible and coinsurance
• You will pay a monthly premium for Part B
• No maximum out-of-pocket limit
• The Part A deductible is per benefit period
Costs on Medicare Advantage:
• You still need to pay your Part B premium in order to be eligible for a Medicare Advantage Plan
So, which is better –Original Medicare or Medicare Advantage? This answer depends on your specific situation and your health care coverage goals. If you’re looking to cover the gaps in Original Medicare, then the best option for you might be a Medigap plan in combination with a Part D prescription drug plan. If you can’t enroll in a Medigap plan, then having Medicare Advantage is better than just having Original Medicare.
Original Medicare vs Medicare Advantage: https://www.medicarefaq.com/faqs/original-medicare-vs-medicare-advantage/
Original Medicare vs Medicare Supplements: https://www.medicarefaq.com/faqs/medicare-advantage-vs-medicare-supplement/
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