Choosing a Medicare Advantage plan
Overview
Before enrolling in a Medicare Advantage (MA) plan (such as an HMO), get as much information as you can. If possible, talk to people you know who are already enrolled in the plan, or ask your doctor about the plan you are considering.
Be sure to find out the answers to these questions:
- Are there specific physicians you want to see? If so, find out whether they're in the plan's network of physicians. If not, how much will you have to pay if you want to see these physicians?
- Does the MA plan include Part D drug benefits? (Note: several MA plans, such as some PFFS plans, Medicare Savings Account plans, and a few HMOs, do not offer Medicare Part D benefits) If it does offer Part D coverage, does it cover the prescription drugs you are taking now? Check the plan's formulary to find out what is available to you and at what cost. (A formulary is a list of prescription drugs that your private health plan, such as a Medicare HMO, will pay for either in part or in full.)
- Do you already have a Medigap policy? If you do, you won't need to keep it if you decide to enroll in an MA plan. A Medigap plan only pays benefits while you are in Original Medicare. Once you join an MA plan, you can wait a month or two to cancel your Medigap policy if you are not sure whether you will like being in the MA plan. But note that there are restrictions on when you can join and leave MA plans.
Take your time. Do not feel pressured to sign on with any plan — this is your choice, and you should take time to get all the facts, although make sure you make a decision before the end of any enrollment period that might apply.
Keep records when you talk with representatives of different MA plans. Write down the names of people you talk with and their contact information, the date and time of the conversation, and what you discussed.
Know when it is and is not appropriate to be questioned about your medical history. MA plans may only deny a person if he or she has end-stage renal disease. However, they may ask you questions about your health conditions to help your primary care physician make decisions about health care services you may need, and to assess your eligibility for any special programs the MA plan may provide for people with chronic health conditions.
If you are considering an MA plan to help save money, find out if you are eligible for low-income assistance that can help cover many of your costs. To learn about MA plans in your area, contact your local HICAP or use the Personal Plan Finder Tool on Medicare.gov.
Deciding between a Medicare Advantage (MA) plan & Medigap
There are many factors that determine whether an MA plan or Medigap is best for you. You must consider the plans and policies offered in your area, your health care preferences, and your income.
MA plans provide health services covered under Medicare Parts A and B and may provide additional services not covered by Original Medicare. If you join an MA plan, you do not need to purchase a Medigap policy and it is illegal for a company to sell you one. If you have a Medigap policy when you join an MA plan, you can keep it for a few months while you decide whether you want to remain in the MA plan. But note that there are restrictions on when you can join and leave an MA plan and when you can return to Original Medicare.
In general, the premiums for MA plans are lower than premiums for Medigap policies. Yet, copayments may actually make an MA plan more expensive than a Medigap depending on what services and/or benefits you need to use. For example, people with a Medigap policy who are receiving cancer therapy under Part B covered services, will most likely have no out-of-pocket costs for that therapy. Medicare pays 80% of the cost and Medigap covers the other 20%. In many MA plans, however, people receiving cancer therapy and/or other treatments for serious illnesses are often required to pay the 20% as a ‘copayment’.
Some MA plans provide services in addition to those covered by Medigap policies, such as Part D prescription drug coverage, vision or dental exams, hearing aids, or wellness classes. If you have Original Medicare and a Medigap policy you will need to buy separate coverage for Medicare Part D’s prescription drug benefit because Medigap policies cannot include that benefit. See our section about Medicare prescription drug coverage for more information.
With most MA plans, you may see only those health care providers affiliated with the MA plan. You will have to pay a small co-payment each time you visit a doctor or use other services. In some cases, as mentioned above, you may be required to pay large co-payments (if you need dialysis or you receive treatment for cancer, for example). Make sure you understand all the co-payments you may be required to pay under an MA plan.
With most Medigap policies, you may see any doctor you choose. The purchase of a Medigap policy is only guaranteed in the first 6 months after you become eligible for Part B (unless you are younger than 65 and have end-stage renal disease) and in a few other situations. There are certain times when you might become eligible for Medigap due to changes in your Medicare Advantage plan. See the section on Medigap guaranteed-issue events for more information.
MA plan example
You want to see a doctor for cataract problems. If you have a Medicare HMO, you must call your primary care physician at the plan and get approval to see a specialist within the plan's network of physicians. If you obtain approval, you can see the specialist. You may be charged a small fee (co-payment) for the visit.
Medigap policy example
You want to see a doctor for cataract problems. If you have a Medigap policy, you can call a specialist directly and make an appointment. Your visit will be covered up to 100% of the standard Medicare-approved amount for this type of visit. The 20% co-insurance will be covered by your Medigap policy. If your doctor does not accept assignment, your doctor may charge you 15% more than the approved amount. This excess charge may be covered by your Medigap policy, depending on whether excess charges are a covered benefit of your policy.
| Benefits and Costs | Medicare Advantage Plans | Original Medicare with Medigap |
|---|---|---|
| You are charged monthly premiums (in addition to paying monthly for Medicare Part B). | Usually | Yes |
| You can be charged a fee at each doctor's visit (called co-payments). | Usually | Sometimes, if the amount of your medical bill is more than the coinsurance amount |
| The benefits in your plan may change from year to year. | Usually | No |
| Some prescription drug coverage is offered. | Depends on plan (many HMOs, PPOs and some PFFS plans offer Medicare Prescription Drug Coverage, sometimes for an additional monthly premium) | Some prescription drug benefits are included in the older H, I and J policies. However, since January 2006 these benefits are no longer be sold. |
| You may have extra benefits covered, such as eyeglasses and hearing aids. | Depends on plan | No |
| You may have a restricted list of available providers. | Yes. You must use the plan's network of doctors and must be referred to a specialist. If you want to see a doctor outside the plan, it will cost more. The common exception is when you have an emergency outside of the plan's area. | No |
| The premium for the plan or policy can change from year to year. | Yes | Yes |
| You must be allowed to enroll, regardless of health condition, as long as you have Medicare Parts A and B. | Yes. Medicare Advantage plans offered in your area are required to accept you unless they are closed to all new members. If they are closed, they must accept you during the annual coordinated enrollment period from November 15 through December 31 each year (except if you have end-stage renal disease). They must also accept you in the following situations:
|
Only during the first 6 months after enrolling in Part B (and at other special times discussed in the section 'Your rights to buy a Medigap policy'). After this 6-month period, plans can reject applicants based on health conditions or charge them a higher premium. |
Page updated April 15, 2008