Should you opt for Original Medicare or Medicare Advantage (Part C)?
By Chris I. Young, Staff Writer |March 23,
2018, at 1:23 p.m.
Medicare vs. Medicare Advantage: How
to Choose
Decoding
Medicare health insurance plan options can be daunting for Medicare
beneficiaries. People usually qualify for Medicare at
age 65 and may be automatically signed up if they're receiving Social Security
payments, unless they take steps to opt out. Original Medicare comes in two
parts: Part A and Part B. Part A covers a portion of hospitalization expenses,
and Part B applies to doctor bills and other medical expenses, such as lab
tests and some preventive screenings.
But
some individuals may find better value in Medicare Advantage plans. Such plans
are run by private insurance companies regulated by the government, and they
must offer coverage that's comparable to Original Medicare parts A and B. Most
Medicare Advantage plans also include prescription drug coverage, which is an
optional add-on called Part D for beneficiaries who keep
Original Medicare.
Some
Medicare Advantage plans have a $0 monthly premium, while others come with a
higher monthly premium. You must continue to pay your Part B premium, which is
expected to be $134 per month for most beneficiaries in 2018. Medicare
Advantage plans are similar to individual health insurance policies you may
have received through your employer or signed up for on your own through the
individual insurance market, in that they have different monthly premiums,
provider networks, copays, coinsurance and out-of-pocket limits. The trade-off
for a lower premium (or $0 premium) could be higher copays or coinsurance.
Whether
or not a Medicare Advantage plan costs more, it could be better or worse for
you than Original Medicare. Consumers have to carefully review the details of
each plan and make a clear-eyed appraisal of their circumstances, including
their health, budget and tolerance for financial risk.
The
Pros and Cons of Medicare vs. Medicare Advantage if ...
- You
take prescription drugs. As stated, Original Medicare
doesn't cover prescriptions unless you enroll in stand-alone Medicare.
(The average monthly cost of Part D will be $33.50 in 2018.) By contrast,
about 82 percent of Medicare Advantage plans include prescription drug
coverage, according to the Kaiser Family Foundation,
a nonprofit, nonpartisan research institute. In some cases your monthly
premium will exceed the amount you'd pay for Medicare Part D. The federal government and
licensed insurance brokers like PlanPrescriber.com have
online tools where you can check how much you'll pay for the medications
you need. (U.S. News has a revenue-generating agreement with
eHealthInsurance, which owns PlanPrescriber.com.)
- You
want a cap on your out-of-pocket health spending. Original
Medicare has no out-of-pocket maximum. You keep paying a portion of the
cost of services as you use them. Medicare Advantage plans, by law, have
an out-of-pocket maximum of no more than $6,700 per year, although plans
can choose to have a lower out-of-pocket maximum. Once you hit that limit,
the plan pays for all covered expenses.
- You
want an alternative to enhancing your Medicare coverage with private
"Medigap" (Medicare Supplement) insurance. Medigap plans cover or help cover
certain deductibles, coinsurance and out-of-pocket costs of Original Medicare.
Some Medicare Advantage plans, but certainly not all, will be more
cost-effective than adding Medigapcoverage to Original Medicare.
Scrutinize the plan details if this is your reason for considering
Medicare Advantage.
- You
want an alternative to the 20 percent coinsurance charged by Original Medicare
for most services. Medicare Advantage plans structure costs differently
and have an out-of-pocket maximum, which limits how much you’re required
to spend on your medical care each year.
- You
want coverage for vision and dental. Original Medicare doesn't
cover these services. Certain Medicare Advantage plans do.
- You
want the broadest possible choice in doctors and other medical providers. More
providers accept Original Medicare than private Medicare Advantage
insurance. Private insurance plans tend to be restricted to a specific
network, like a Health Maintenance Organization network. If you travel
frequently, you may want to consider staying with Original Medicare for
this reason.
- You
want maximum flexibility when seeking medical specialists. Under Original
Medicare, you don't need prior authorization from a primary care doctor to
see a specialist, whereas Medicare Advantage plans that are designated
HMOs could require you to see a primary care doctor first. Preferred
Provider Organization plans may allow you to see a specialist without a
referral, but seeing an out-of-network doctor or specialist would cost you
more. Most Medicare Advantage plans are either HMOs or PPOs.
- You're
still employed and covered by your employer. You might
end up paying an unnecessary premium for Medicare Advantage or could lose
your employer-provided coverage. Check with your human resources
department and the Social Security Administration for specifics.
- You
have employer-sponsored retiree health benefits that supplement Original
Medicare. These
benefits wouldn't help with Medicare Advantage, so check with your human
resources department before signing up for a Medicare Advantage plan.
- You
qualify for Medicaid or a Medicare Savings Program. Low-income
Medicare beneficiaries have other options and should contact their state
Medicaid office.
If you
decide to sign up for a Medicare Advantage plan, you may enroll
between Oct. 15 and Dec. 7 – the period known as Medicare Annual Election
Period – in order for your coverage to start the first of the following year.
(Original Medicare has separate enrollment periods for beneficiaries who aren't
automatically enrolled.) Because of government regulation, Medicare Advantage
premiums are not influenced by age, health status or the method by which a
consumer signs up (through a licensed insurance agent, for example, or directly
through an insurer). Monthly cost – and plan availability – varies from county
to county.
10 MEDICAL SERVICES MEDICARE DOESN’T COVER
Coverage gaps
Many
older adults need glasses, hearing aids and dental work, but Medicare typically
won’t pay for any of these services. And if your health deteriorates to the
point where you need extensive long-term care, Medicare will pick up the tab for only a
very limited amount of time and under specific circumstances. Here’s a look at
some commonly needed medical services that Medicare doesn’t pay for.
Dental care
Medicare
doesn’t pay for routine dental cleanings and fillings. Dentures and other types
of dental devices aren’t covered either. Medicare Part A might pay for certain
dental services received while hospitalized during an emergency.
Hearing aids
Medicare won’t pay for a hearing aidor the exam required to select and
fit an appropriate device. However, Medicare could cover a hearing and balance
exam if your doctor determines it’s necessary.
Routine eye examinations
Vision
checks for the purpose of prescribing glasses and contact lenses are not
covered by Medicare. However, eye exams and tests may be covered by Medicare
Part B for people with specific conditions, such as an annual glaucoma test for
high-risk retirees, a yearly eye exam for diabetic retinopathy and tests and
treatments for age-related macular degeneration.
Glasses and contacts
Many
older people need corrective lenses to see clearly, but Medicare typically
doesn’t cover the cost of glasses or contact lenses. However, if
you receive cataract surgery that implants an intraocular lens, Medicare will
cover one pair of eyeglasses or one set of contact lenses provided by a
Medicare-approved supplier.
Cosmetic surgery
Medicare
won’t cover most types of cosmetic surgery. However, if the surgery is due to
an injury or deformity, Medicare might pay for it. For example, Medicare will
cover a breast prosthesis for breast cancer survivors.
Routine foot care
Medicare Part B will cover medically
necessary podiatrist services for foot injuries, including hammer toes, bunions
and heel spurs. However, Medicare won’t cover routine foot care such as the
removal of corns and calluses, nail maintenance or foot cleaning. Foot exams
and treatments could be covered for those with diabetes or other specific
conditions.
Acupuncture
This
Chinese medicine procedure involves inserting needles into the skin at specific
places on the body and is thought to relieve various ailments. However,
Medicare won’t pay for acupuncture treatments.
Care received outside the U.S.
Medicare
typically won’t cover health care received in another country. However, there are a
couple of rare instances when Medicare will pay, such as if a foreign hospital
is closer than the nearest U.S. hospital for a retiree injured in the U.S. or
if you receive emergency medical services in Canada while traveling between
Alaska and the continental U.S.
Personal care
If you
need to hire help for bathing, dressing or getting out of bed, Medicare
typically won’t cover the cost. Medicare also generally won’t pay for
housekeeping services, such as help with shopping, meals delivered to your home
or 24-hour assistance at home.
Long-term care
Medicare
will pay for a short-term stay at a nursing facility if it follows a hospital
stay of three or more days. While there’s no cost-sharing requirements for the
first 20 days of care, you’ll owe $161 per day for days 21 through 100.
Medicare won’t pay out benefits on nursing home stays
that exceed 100 days.
Read More
Updated on March 23, 2018: This article was originally
published on Dec. 4, 2012 and and has been updated to include new information.
https://health.usnews.com/health-care/health-insurance/articles/medicare-vs-medicare-advantage-how-to-choose
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