Medicare Advantage
Key Points
When you enroll in a Medicare Advantage plan (Part C), you agree to receive your Medicare benefits through a private insurance plan instead of Original Medicare.
These plans operate within defined network areas, and the flexibility you have with doctors and providers depends on the type of plan you choose.
You can enroll in a Medicare Advantage plan during several periods throughout the year, including your Initial Enrollment Period, the Annual Election Period, and other qualifying times.
Medicare Advantage plans, also known as Part C, were established under the Balanced Budget Act of 1997, signed by President Bill Clinton. Some medical providers refer to them as “replacement plans,” a term explained further below.
These plans were created by Congress to give Medicare beneficiaries a lower-cost alternative to Medigap, especially helpful for those who missed their Medigap Open Enrollment window and may now be ineligible due to health conditions.
It’s important to understand that Medicare Advantage (MA) plans are very different from Medigap. With an Advantage plan, your benefits are administered by a private insurance company instead of Original Medicare. While some refer to them as “Medicare replacement” plans, this is a bit misleading—Medicare itself discourages that terminology. Enrolling in a Medicare Advantage plan doesn’t permanently replace your Medicare; rather, you’re choosing to receive your benefits through a private insurer for that calendar year. You can always switch back to Original Medicare during a valid enrollment period.
Understanding the Functionality of Medicare Advantage
A Medicare Advantage plan is a private insurance option that allows you to receive your Part A and Part B benefits as an alternative to Original Medicare. In this setup, Medicare pays the private plan a monthly amount to manage your healthcare coverage.
To enroll in a Medicare Advantage plan, you must remain enrolled in both Medicare Part A and Part B. Medicare shifts the responsibility for your medical care to the Advantage plan provider, which is how these plans are funded.
When receiving care, you’ll use your Medicare Advantage ID card, and your providers will bill the plan—not Original Medicare. This is why some providers refer to these plans as “Medicare replacement plans.” However, that term can be misleading—you’re still in the Medicare system and can switch back to Original Medicare during a future Annual Election Period.
Each Medicare Advantage plan includes a benefits summary that outlines the copays for various healthcare services. This summary details what you’ll pay for things like doctor visits, lab work, surgeries, and more—similar to how coverage works under Original Medicare.
For example, you might pay a $10 copay for a primary care visit, while specialist visits often come with higher copays, typically around $50. Larger expenses, such as hospital stays, diagnostic imaging, or surgeries, may have higher copays as well.
These costs can vary widely by location, so it’s important to review plans specific to your state or zip code. One advantage of Medicare Advantage plans is that many offer extra benefits not included in Original Medicare—like routine dental, vision, hearing care, and even perks such as gym memberships.
If you’re interested in plans that include dental and vision coverage, our team at Boomer Benefits can help you compare these added benefits across multiple carriers.
For a full breakdown of what Medicare Advantage (Part C) includes, visit our Medicare Part C page.
Networks within Medicare Advantage
In exchange for lower premiums, Medicare Advantage plans require you to follow certain rules—most operate within HMO or PPO networks.
HMO (Health Maintenance Organization) plans typically require you to receive care from in-network providers, except in emergencies. You’ll usually need to choose a primary care physician who coordinates your care and provides referrals to specialists. Some HMO plans include a point-of-service option, allowing limited access to out-of-network providers.
HMO plans are the most common type, making up about 71% of all Medicare Advantage plans, according to a study by Mark Farrah Associates.
PPO (Preferred Provider Organization) plans offer more flexibility by allowing you to see out-of-network providers, though you’ll pay higher out-of-pocket costs when doing so.
In certain counties, you may also find Medicare Private-Fee-for-Service (PFFS) plans. These operate differently and may or may not include Part D coverage. While once more widespread, PFFS plans have largely been phased out in most areas.
Fundamental Rules of Medicare Advantage
When deciding between Medicare Advantage and Medigap, it’s important to understand a few key rules before enrolling.
To join a Medicare Advantage plan, you must be enrolled in both Medicare Part A and Part B and live within the plan’s service area. A common misconception is that you can drop Part B while on a Medicare Advantage plan—doing so will immediately cancel your Advantage coverage.
For the most affordable care, it’s best to use doctors and hospitals within the plan’s network. Most Advantage plans use either HMO or PPO networks. HMO plans usually cover only in-network care (except in emergencies), while PPO plans allow out-of-network care, but at a higher cost.
Some Advantage plans require prior authorization for certain procedures, and many HMO plans also require a referral from your primary care doctor to see a specialist.
Keep your red, white, and blue Medicare card in a safe place—you won’t need to show it when receiving care. Your providers should bill your Medicare Advantage plan, not Original Medicare. When you enroll in an Advantage plan, you’re choosing to receive your Medicare benefits through a private insurer for the entire calendar year.
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Enrollment Periods for Medicare Advantage
Medicare Advantage plans have lock-in periods, meaning you can initially enroll during your Initial Enrollment Period at age 65, but after that, changes can only be made during specific times of the year. Once enrolled, you’re generally committed to the plan for the full calendar year. Disenrollment is only allowed during designated periods or if you qualify for a Special Enrollment Period due to certain life events.
The most common time to make changes to your Medicare Advantage coverage is during the Annual Election Period, which runs from October 15 to December 7. Any updates made during this time take effect on January 1.
If you decide to switch from a Medicare Advantage Prescription Drug plan (MAPD) back to Original Medicare, it’s important to notify your Advantage plan provider. If you don’t, Medicare may still show you as enrolled in the Advantage plan, which can delay your return to Original Medicare.
Open Enrollment Period for Medicare Advantage
Some people enroll in a Medicare Advantage plan without fully researching their options or consulting with an agent, only to later find out their doctor isn’t in-network or their medications aren’t covered. This often happens in January, after changes made during the Annual Election Period take effect.
To help with these situations, Congress created the Medicare Advantage Open Enrollment Period, which runs from January 1 to March 31 each year. During this time, you can disenroll from your Medicare Advantage plan and return to Original Medicare. You can also enroll in a standalone Part D prescription drug plan.
However, it’s important to understand that returning to a previous Medigap plan is not guaranteed. Unless this is your first time ever in a Medicare Advantage plan, reapplying for Medigap usually requires answering health questions and going through medical underwriting. This should be carefully considered before dropping a Medigap plan in favor of Medicare Advantage.
Alternatively, during this Open Enrollment Period, you’re allowed to switch from your current Medicare Advantage plan to a different one—but only once per calendar year.
Original Medicare vs. Medicare Advantage
Congress created these plans to offer alternatives for accessing your Medicare benefits. Some reasons why individuals might opt for an Advantage plan include:
1. Many plans feature low monthly premiums (although you must still pay your Medicare Part B premium).
2. Payment for medical services occurs as you use them through copays and coinsurance.
3. Unlike Original Medicare, Medicare Advantage plans have an out-of-pocket maximum cap, safeguarding against catastrophic spending.
4. The convenience of consolidating medical and Part D drug benefits into a single plan. Plans with drug coverage are referred to as MAPDs.
5. Some plans may provide additional benefits, such as limited vision coverage. Note that limitations, copayments, and restrictions may apply.
It's important to recognize that this is a personal choice with no right or wrong answer. When weighing Original Medicare vs. Medicare Advantage, consider your own understanding of your medical needs and usage.
Medicare Supplement (Medigap) vs. Medicare Advantage
Original Medicare combined with a Medigap plan is widely recognized for offering comprehensive coverage. One major advantage of Medigap is flexibility—you can see any doctor nationwide who accepts Medicare, without needing to check if they’re part of a specific insurance company’s network. The “network” is Medicare itself, which includes over 1 million providers across the country.
Medigap plans also help reduce out-of-pocket costs. While Medicare generally covers 80% of approved services, your Medigap plan can cover some or all of the remaining 20%. For example, those enrolled in Plan G often avoid repeated copays for doctor visits, which are more common with Medicare Advantage plans.
However, Medigap does not include Part D prescription drug coverage, so you’ll need to purchase a standalone Part D plan. Medigap also doesn’t cover routine dental, vision, or hearing care—benefits that some Medicare Advantage plans may include in a limited form.
Ultimately, there’s no one-size-fits-all answer. Both options offer different benefits—choose the one that best fits your healthcare needs and lifestyle.
Additional Factors to Think About Regarding Medicare Advantage
Before enrolling in a Medicare Advantage plan, it’s important to carefully consider the following:
1. Provider Participation – Not all doctors and hospitals accept Medicare Advantage plans. Confirm with your agent whether your current healthcare providers are in-network for the plan you’re considering.
2. Annual Plan Changes – Medicare Advantage benefits can change each year. Every September, you’ll receive an Annual Notice of Change from your insurance company outlining any updates that take effect on January 1. Review this document closely and contact your agent if you have concerns about changes in coverage, the drug formulary, provider or pharmacy networks, premiums, copays, or coinsurance.
3. Yearly Commitment – Enrollment in a Medicare Advantage plan typically locks you in for the full calendar year. If you want to switch plans mid-year—say in April—you’ll usually need to wait until the Annual Election Period (October 15 – December 7), unless you qualify for a Special Enrollment Period.
4. Medigap Enrollment Window – If you choose a Medicare Advantage plan at age 65, be aware that your one-time Medigap Open Enrollment Period lasts only six months from your Part B effective date. After that, if you decide to switch to a Medigap plan, you may have to answer health questions—and coverage isn’t guaranteed if you don’t meet medical underwriting requirements.
Taking the time to weigh these factors can help ensure you choose the plan that’s best suited for your long-term healthcare needs.
Is the Part B premium included in Medicare Advantage?
No, you need to initially enroll in both Medicare Parts A and B before becoming eligible to supplement with an Advantage plan. This holds true even if the Advantage plan itself has a $0 premium; you will continue to pay your Part B premium to Medicare every month.
How is it possible for Medicare Advantage plans to be offered at no cost?
Medicare Advantage plans aren’t entirely free. While some may advertise a $0 monthly premium, you’re still responsible for paying your Medicare Part B premium. Plus, you’ll encounter costs like deductibles, copays, and coinsurance as you use your benefits.
When you enroll in a Medicare Advantage plan, Medicare pays the insurance company a monthly fee to manage your care and take on the financial risk. This arrangement is what allows some plans to offer a $0 premium—they’re already being funded by Medicare on your behalf.
What does MAPD stand for?
A MAPD refers to a Medicare Advantage Prescription Drug plan, which is an Advantage plan incorporating drug coverage. In contrast, Advantage plans without drug coverage are abbreviated as MA.
Conclusion
Many people ask us which Medicare Advantage plan is the best—but the truth is, the right plan depends on your unique needs. What works well for a friend or neighbor might not be the best fit for you. When it comes to something as important as your health coverage, it’s wise not to take chances.
Let a knowledgeable agent walk you through your options and help you make an informed decision.
Call Side By Side Insurance Solutions today at (863) 450-1777 for expert guidance!
Key Takeaways
Even with an Advantage plan, you still need to cover the Medicare Part B premium.
Many Advantage plans incorporate integrated Part D coverage and are termed Medicare Advantage Prescription Drug (MAPD) plans, often recognized as "all-in-one" plans.
Advantage plans operate with distinct mechanisms compared to Original Medicare and Medigap plans. If you're contemplating an Advantage plan, it's crucial to have a clear understanding of their features.
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