Medicare Advantage plans can be confusing. Let’s take a look at the advantages and disadvantages of these plans.
What are the pros of Medicare Advantage plans?
Some insurance companies offer $0 premium Medicare Advantage plans. These plans include the Medicare Part D benefits.
Beyond the benefits that Original Medicare offers, Medicare Advantage plans may cover additional benefits that are not covered by Part A and Part B, such as vision or dental coverage.
Each plan comes with a maximum out-of-pocket limit on healthcare costs during each calendar year.
Once that limit is reached, there is no cost for covered services. Each Medicare Advantage plan could
have a different limit, and that amount may change each year.
Now, let’s take a look at the cons of Medicare Advantage plans?
The plans are not standardized making shopping more difficult.
Since Medicare Advantage plans are administered through private insurance companies, the rules and guidelines can vary.
Benefits are not guaranteed
Premiums are not guaranteed
Coverage is not guaranteed. Medicare Advantage plans have annual contracts with Medicare and can
choose not to renew their contract for the following year.
A Medicare beneficiary can experience restricted access to care. Because managed care plans aim to keep healthcare costs within a budget, they try to prevent overuse through various means — such as prior authorization for services.
There is no guarantee on providers.
With Original Medicare, a person can choose to see any physician who accepts Medicare. This means that they can access major medical centers nationwide. On the other hand, Medicare Advantage plans are more restricted in terms of the provider networks. Providers can withdraw from the network.
And one last disadvantage that can have a substantial impact is the inability to shop Part D prescription
drug benefits each year against stand-alone prescription drug plans. This could potentially cost hundreds of dollars each year in savings.