The Medicare system can be really confusing for many people, and with Medicare Advantage plans in the news recently it may be a good time to discuss what they actually are. Congress just voted in favor of cutting some funding to Advantage plans to be able to eliminate a 10% pay cut for services to doctors. Many doctors felt that they wouldn’t be able to continue servicing Medicare patients if they had received the pay cut for their services. This would have limited the Medicare patient’s ability to see doctors, because the choices of doctors that the patient could see would have been dramatically reduced. Many doctors feel that even under the current payments from Medicare that they may not be able to continue to see patients.
A Medicare Advantage plan is different than the original Medicare plan. It is also different than a Medicare Supplemental policy. A Medicare Supplement extends the coverage of the original Medicare plan, offering more coverage in areas that original Medicare may have nominal coverage. A Medicare Advantage plan, however, may have coverage in areas that the original Medicare plan does not. A Medicare Supplement will not have coverage in an area that original Medicare doesn’t have coverage.
Many Medicare Advantage plans have a familiar ring to them. They are plans or companies that you have heard of – Aetna, Secure Horizons, Humana. But there are many more that you may not have heard of like Bravo, Coventry, Care Improvement Plus, or Physician’s Health Choice. So what are the differences between these Medicare Advantage plans? Well, that’s a difficult question to answer because these plans vary from county to county, and most companies only offer plans in certain counties of a state. Therefore it is imperative that you look at each plan with someone who is familiar with what is offered in your specific area.
Medicare Advantage plans can offer extra coverage in areas that Medicare does not, but it must have at least the same coverage as Medicare itself. Some plans offer some minimal dental coverage, such as a yearly checkup. Some plans even offer gym memberships to local gyms. It is also important to look at these “extras” in a plan to see how other plans hold up.
What happens in a Medicare Advantage plan is that a private insurance company takes over the original Medicare plan. Medicare then gives that insurance company a set amount of money per month for managing that health plan. With a Medicare Advantage plan the patient still has to pay their monthly premiums for Medicare from their social security checks, but may not have to pay any extra premiums to their Medicare Advantage plan. Many of these Advantage plans are set up so that there are no extra charges to the patient even though there may be much more coverage than just Medicare itself. Since the Medicare Advantage program is being paid directly by Medicare, basic plans may not even have any premiums associated with them. However, for more extensive coverage or in some counties there may be premiums that also have to be paid to the Advantage plan. It all just depends on the specific plan.
These Advantage plans are in direct competition with each other, which helps to ensure that the plans keep offering as much or more coverage than other plans in the area. Therefore, it is important to know what is being offered. Make sure to compare Advantage plans, as one may offer more coverage than another. The fact that these plans are competing against each other is a very good thing as it will ensure that these plans offer the most coverage because they want to be at least as good as other plans in the service area.
It is also a good idea to price Medicare Supplemental policies as well. Supplements will only extend the coverages of Medicare (I.e. they will not be able to offer local gym memberships, etc), but can also be excellent plans. A plan J is the most extensive coverage you can purchase, but is very expensive. For those people lucky enough not to have to worry about budgets, a Medicare Supplement may be the right choice. However, for the rest of us, Medicare Advantage plans are a great option because they are relatively cheap and have great coverage.
