04/19/2021
What are the benefits of Original Medicare versus a Medicare Advantage plan?
Joanne Johnson from Insurance Solutions Plus LLC
Answered on Apr 19th, 2021
I'm a health insurance broker with a focus on Medicare. If you're eligible for Medicare it's important to understand "Original Medicare" has a monthly premium for Medicare Part B, plus deductibles, copays and coinsurance payments. This is money you MUST pay depending on the service provided. In addition, if something catastrophic happens to you, there is NO safety net- no limit to how much you will have to pay for your care.
Those who stay with Original Medicare often forget to enroll in a Medicare Part D Prescription Drug plan when first eligible. Failure to do so is costly because of Medicare’s Late Enrollment Penalty (LEP). The LEP can be hefty depending on how many months they went without coverage. I've spoken with many Medicare recipients who didn't enroll in Part D when they first qualified and then find out they have to pay this penalty each month for as long as they have Medicare.
Once eligible for Medicare, you've two choices :
1) Stay with Original Medicare and add a Medicare Supplement Plan (aka Medigap) and a stand-alone Part D prescription drug plan. You’ll pay your Medicare Part B Premium, a Medicare Supplement Plan Premium & a Part D premium. If you need any dental and/or vision care, you’ll pay a separate premium for that too.
or
2) Enroll in a Medicare Advantage Plan (also called Part C). These coordinated care plans are governed by provider networks. HMO, PPO, PFFS and MSA are all types of coordinated care plans. HMO's offer access only to network providers unless it's an emergency. PPO's provide access to in-network providers with the flexibility to see out-of-network providers (but at higher cost sharing). PFFS and MSA plans generally allow you to see any provider who agrees to accept payment from the plan. Each of these Part C/Medicare Advantage plans require you to live in the plan's service area and protect you financially with a pre-set Maximum-Out-Of Pocket (MOOP). You'll pay copays for some services and coinsurance for others. Every payment you make is credited to the MOOP which is your financial safety net for all in-patient and out-patient medical expenses for the calendar year. Many Medicare Advantage plans charge either a $0 or a minimal monthly premium. You will also still have to pay your Medicare Part B premium. Compare this to those choosing Original Medicare plus a Medicare Supplement/Medigap plan. They will pay a premium for their Medicare Part B, a higher premium for their Medigap plan, plus a Part D premium and a premium for any dental/vision coverage they choose.
Medicare Care Advantage/Part C plans usually include a Part D prescription drug plan and a host of other extra benefits not provided with a Medicare Supplement/Medigap plan. Part C plans typically offer extras benefits such as money for optometry, hearing aids, comprehensive dental care, a fitness membership and a quarterly Over-the-Counter (OTC) benefit you can use to purchase items you'd typically buy at a drugstore.
Medicare Advantage/Part C plans can be very cost effective. Most of the larger insurance companies will enable you to see providers outside of your geographic area, if they belong to your plan's national Medicare network, at the same cost sharing offered by your plan. So, with these plans you needn't worry about access to care if you are traveling. You also have emergency coverage worldwide!
It's important to evaluate your needs and budget to determine which option will be most cost efficient for you. Unlike captive agents who only represent one insurance company, meet with an informed broker who represents a number of insurance companies & plans so YOUR needs are the primary consideration.
Brokers, such as myself, are paid a commission from the insurance companies they represent. Our compensation is set by Medicare. Our services provide you with ample benefit but zero cost! Brokers are nimble. We can find the plan which gives you access to the providers/doctors you want to see and inform you on the cost sharing plus any additional benefits which will enhance your experience and coverage. We’re also focused on building a business so we’re responsive to your future needs. We answer calls and are available for follow up questions.
A good broker will also reach out to remind you of the Annual Open Enrollment (Oct 15-Dec 7th) for Medicare Advantage and Part D coverage to ensure your current coverage will continue to meet your needs for the new plan year and, if not, will facilitate any plan changes that are needed. If you have a Medicare Supplement plan we’ll also be able to assist you with Medicare Trial Rights and any other rulings that are specific to your state.
You have questions; I have answers. Call or text me at 314-518-8266 or email [email protected]. Click here to visit my website
