When you are eligible for Medicare, you can choose either Original Medicare or a Medicare Advantage plan. However, there are many different factors to consider before you decide. Below we will look at the key differences to help you choose the right plan.
Original Medicare
Operated by the federal government, Original Medicare is available from any doctor or provider that accepts Medicare. The program can be split into two parts:
Part A focuses on hospital insurance. It includes coverage for inpatient hospital stays or care in nursing facilities or hospices. It can also cover home health care.
Part B focuses on medical insurance. It covers some doctor services, preventative care, outpatient care, laboratory tests, x-rays, mental health care and medical supplies. A monthly premium is generally required for part B, which is set each year at a federal level.
Medicare Advantage Plans
Medicare Advantage Plans (also known as Part C) is accessible by private companies that have been pre-approved by Medicare. They cover all services under Original Medicare (both parts A and B), except for hospice care. Premiums are set by individual organizations and can differ based on the plan and variables selected. Medicare Advantage is covered under:
Part C: A contractual agreement between Medicare and private companies. It covers benefits provided in Parts A and B such as HMO, PPO, and Medicare Medical Savings Account Plans. Medicare Advantage may cover some prescription drugs (Part D), dental, hearing and eye care services, as well as some health and wellness programs.
Part D covers prescription drugs. While Original Medicare does not cover Part D, your Medicare Advantage Plan may, depending on your specific benefits package. It is provided only through private health insurance companies that hold specific contracts with the federal government.
Key Differences Between Original Medicare and Medicare Advantage Plans
As you have seen above, each part offers specific coverage. Depending on your medical needs, you should take each into consideration. It is also important to note how Medicare and Medicare Advantage plans work. Having an understanding of the fundamental differences can guide you with your decision.
Enrollment
Original Medicare: Once you are receiving Social Security benefits, you can enroll in Parts A and B.
Medicare Advantage: Enrollment is open specific times of the year. To qualify for this plan, you already must be enrolled in Parts A and B.
Cost
Medicare: Part A is free if you have been paying taxes for at least ten years. Otherwise, you pay a monthly premium in addition to your Part B premium. Out-of-pockets costs are limited.
Medicare Advantage: Depending on your plan, you pay a low or $0 monthly premium in addition to your Part B premium. Your out-of-pocket costs can vary by plan.
Prescription Drug Coverage
Medicare: Prescription drugs are not covered. You will have to buy Medicare Part D as a stand-alone plan (PDP) to cover these costs.
Medicare Advantage: Most plans include prescription drug coverage under your Medicare Advantage benefits package.
Network
Medicare: You are covered anywhere in the US. Also, there are no network restrictions on this plan.
Medicare Advantage: You may experience some restrictions. However, you are covered within the US as well as some other countries.
Doctors and Hospitals
Medicare: You can choose any doctor or hospital that accepts Medicare in the United States.
Medicare Advantage: You are usually restricted to doctors and hospitals within the network.
Referrals
Medicare: You have the option to visit a specialist without a referral.
Medicare Advantage: Referrals are usually required, and you may be limited to specialists within the network.
Make the Right Choice
Both Medicare and Medicare Advantage plans are beneficial for health care coverage. Depending on your specific needs, one option may be more suitable than the other. If you are still at crossroads with your decision, do not hesitate to contact us. We will answer any further questions you may have.
