Medicare consists of two main parts, but if you want more comprehensive coverage, you’ll want to look into Medicare Supplement and Medicare Advantage plans. Original Medicare does not cover 100% of your medical expenses, so enrolling in an additional plan can help prevent you from financial devastation. One type of plan that can help cap your costs is a Medicare Advantage plan, but what are these plans?
Medicare Advantage plan coverage
Once you enroll in Medicare Part A and Part B, you can decide to enroll in a Medicare Advantage plan offered by a private insurer. You must always stay enrolled in Original Medicare, but you’ll receive your Medicare benefits through your Advantage plan. Original Medicare pays the Advantage plan a certain amount each month to provide your Medicare benefits.
Since you receive your benefits through your plan, your Advantage plan manages your care and services. Your costs for services will depend on the plan and what they have set. Generally, you have a specific copay or coinsurance for every service. You can view these costs in the plan’s Summary of Benefits document before you enroll to ensure it will provide you with the coverage you need.
Advantage plans can also cover additional benefits that you don’t get with Original Medicare. These benefits can include a gym membership, dental, and vision coverage. All plans must offer the same coverage you would receive from Original Medicare, but the cost-sharing and additional benefits will vary with each Advantage plan. For more details about this option, visit Medicare Advantage – Boomer Benefits.
Your Costs with Medicare Advantage plans
Many people are surprised to know that they can find an Advantage plan with a $0 premium. Although you may not have a premium for your Advantage plan, you must still pay the Part B premium. You can also find many plans with no medical deductible, which means you’ll immediately start paying copays or coinsurance for your services.
One crucial feature of Advantage plans is their maximum out-of-pocket limit (MOOP). Every Advantage plan will cap your expenses, and in 2022, that cap could be as high as $7,550. Once you meet your plan’s MOOP, the plan will cover all approved costs for the remainder of the year. This cap is advantageous because Original Medicare does not provide a cap on your expenses.
Advantage plans are like employer plans. The two most common types are Health Maintenance Organizations (HMO) or Preferred Provider Organizations (PPO). This means they have networks of providers that you must see to get coverage from your plan.
HMO plans tend to have a smaller network of providers and only help cover in-network services except for emergencies. On the other hand, PPO plans have a more extensive network of providers. They offer coverage for both in-network and out-of-network benefits.
If you don’t see a provider willing to bill your plan, you won’t have coverage from your plan and might have to pay entirely out of pocket. You will always want to ensure your providers accept your Advantage plan.
Drug Coverage with Advantage plans
Most Medicare Advantage plans include drug coverage, so you don’t need an additional plan for your drugs. Each plan has a formulary that lists the medications covered by your plan. All covered drugs are categorized into one of five tiers. Knowing which tier your drugs fall under is essential because that will determine your cost-sharing. Each tier has a copay or coinsurance associated.
Additionally, your drug costs are separate from your hospital and medical services expenses. Your drugs will likely apply to a separate deductible, and there is no cap on your drug costs.
As you approach Medicare age or are past 65 and retiring, you may consider looking at Medicare Advantage plans. They have grown in popularity over the years and have many attractive features. However, don’t forget to verify that your doctors are in-network and that the plan covers your drugs.
Author: Alexandria Roland
Alexandria Roland is a Medicare expert, licensed insurance agent, and digital marketing coordinator at Boomer Benefits. As a content creator, she shares her knowledge of Medicare through many outlets, including writing. Alex helps to manage a growing online community of over 30,000 seniors in the Boomer Benefits Medicare Q&A Facebook Group.