How to Compare Medicare Advantage Plans

Choosing the right Medicare Advantage plan can feel overwhelming. With so many options available, getting lost in the sea of brochures, websites, and phone calls is easy. That’s where learning how to compare Medicare Advantage plans comes in handy. This article will guide you through choosing the best Medicare Advantage plan for your needs.

Understanding Medicare Advantage Plans

Before we proceed with the comparisons, let’s clarify Medicare Advantage plans. Unlike Original Medicare (Part A and Part B), managed by the federal government, Medicare Advantage, or Part C, is offered by private insurance companies that contract with Medicare.

These plans are required to cover everything that Original Medicare covers. However, Medicare Advantage plans often include additional benefits like prescription drug coverage (Part D), dental, vision, hearing, gym benefits, and more. Plan costs are also different from those in Original Medicare.

Types of Medicare Advantage Plans

When you compare Medicare Advantage plans, you’ll encounter various types, each with pros and cons. Let’s take a closer look at the most common ones:

Health Maintenance Organization (HMO) Plans

HMO plans generally require you to get healthcare from providers within the plan’s network. You will likely have to choose a primary care doctor who will act as a gatekeeper for specialist referrals.

While this might seem restrictive, HMOs usually have lower monthly premiums, making them an affordable health insurance option.

Preferred Provider Organization (PPO) Plans

PPO plans offer more flexibility than HMOs. You can see in-network providers for a lower cost, but you also have the freedom to go out-of-network if needed, albeit at a higher price.

PPOs are great if you value seeing doctors outside the plan’s network. Unlike HMO plans, they may not require referrals to see a specialist.

Private Fee-for-Service (PFFS) Plans determine how much they pay healthcare providers and how much you pay for care. This means that these plans don’t use a fixed network, giving you more freedom in choosing your healthcare providers.

If you seek more than just basic coverage, a PFFS plan may be right for you. You can compare Medicare Advantage plans to Original Medicare, as this plan type functions differently than HMO or PPO plans.

Special Needs Plans (SNPs)

Special Needs Plans are specifically designed for individuals with special healthcare needs. These include those with chronic conditions, who reside in nursing homes, or who qualify for both Medicare and Medicaid. They offer tailored benefits and services to meet those needs.

Key Factors to Compare Medicare Advantage Plans

Now that you’re familiar with the various Medicare Advantage plan types, let’s focus on the key factors to compare when making your choice:

1. Coverage and Benefits: Do Plans Meet Your Needs?

Every Medicare Advantage plan must offer the same basic coverage as Original Medicare (Part A and Part B). But that’s not where it ends.

Many Medicare Advantage plans offer extras like prescription drug coverage, dental care, vision care, and hearing care.

Take the time to compare these benefits carefully when choosing a plan. For example, if you have regular prescriptions, ensure the plan covers your medications at a reasonable cost. Other benefits you may want to consider include fitness programs and transportation assistance.

You can use the Medicare plan finder tool to get a side-by-side comparison of what plans include.

2. Costs: Are You Getting Value for Your Money?

Understanding Medicare costs can be tricky because several factors affect the price tag. Beyond the monthly premium (projected average: $18.50 in 2024), here are some additional cost elements to consider:

Deductibles: The amount you pay for healthcare before your plan kicks in.
Copayments: Set dollar amounts you pay for specific services.
Coinsurance: The percentage of healthcare costs you pay after your deductible is met.

Remember to factor these costs into the monthly premium to get a realistic view of your potential expenses. You want to compare Medicare Advantage plans based on overall value, not just the sticker price.

3. Doctor and Hospital Networks: Will You Be Limited?

Knowing which doctors and hospitals are included in a plan’s network can save you money and headaches. If you have doctors you see regularly, make sure they are considered “in-network” before signing up for any given plan.

HMO plans often come with a limited network of providers, while PPOs are generally more flexible. If having access to a specific hospital or specialist is critical, double-check their participation in the plan’s network.

4. Star Ratings: Are Other Enrollees Satisfied?

Medicare Advantage plans receive star ratings (1 to 5 stars) based on quality and performance. Factors like member experience, preventive care, handling of chronic illnesses, and customer service contribute to this rating.

Aim to compare plans with higher star ratings, as they offer better care and support. Remember, though, ratings aren’t the be-all and end-all. Personal needs and circumstances should also guide your decision-making.

5. Out-of-Pocket Maximum: What Happens if You Get Sick?

While no one likes to imagine getting sick, it’s crucial. One big difference between Original Medicare and Medicare Advantage plans is how out-of-pocket costs are handled.

Original Medicare has no yearly spending limit; costs can increase if you face a severe health event. Luckily, Medicare Advantage plans come with an annual out-of-pocket maximum.

It serves as a safety net, limiting the financial burden of unexpected health problems. After reaching the maximum, your plan covers 100% of covered medical costs.

6. Prescription Drug Coverage: Are Your Medications Included?

This is important if you take prescription drugs. Not all plans offer prescription drug coverage, but most do. Review your prescription costs if you choose a plan that includes a Part D prescription drug plan. If you don’t, you might have a plan with affordable health care but unaffordable drug costs.

Here’s why.

Not all plans cover or offer the same medications at the same cost-sharing level. Compare the plans’ drug formularies—the lists of covered medications—to ensure your drugs are included and affordable.

Please pay close attention to their drug tier structure, as it determines how much you pay for each medication. A medication on a higher tier will usually cost you more. You can learn more about prescription drug plans from medicare.gov.

Additional Considerations for a Personalized Choice

Consider these additional factors to personalize your Medicare Advantage choice further:

Location: Available plans and their costs vary depending on your location. Check which companies offer coverage where you live.
Plan Availability: Not every insurance provider offers Medicare Advantage plans in every location. Do your homework and check the providers in your area.
Customer service: If you want a plan, consider contacting the customer service department to gauge its responsiveness and helpfulness.
Online resources: Explore whether they have easy-to-use websites and tools for managing your healthcare, such as refilling prescriptions online.

Who Sells Medicare Advantage Plans?

You might think Medicare Advantage plans come straight from the government, but that’s not how it works. Private insurance companies, not the government, sell these plans. This differs from Original Medicare (Parts A and B), which the government manages directly.

Many companies offer Medicare Advantage plans, and they all want your business. Some big names you might recognize include:

Aetna
Humana
UnitedHealthcare
Blue Cross Blue Shield
Cigna

Keep in mind that not every insurance company offers plans in every area. But this gives you an idea of the different companies involved. Since they’re competing for your business, it’s common to see a lot of variety in the Medicare Advantage plans available where you live.

If you enter your zip code in the search box below, our Medicare Advantage Plan Finder will show all the plans in your area.

[mapd_search]

Medicare Advantage vs. Medicare Supplement

You’ve probably heard about Medicare Supplement plans. But how do they compare to the Medicare coverage you get from Medicare Advantage? It all comes down to how you want to manage your healthcare costs and which doctors you want to see.

Medicare Advantage bundles your Original Medicare benefits into one neat package. Think of it like a health maintenance organization (HMO) or preferred provider organization (PPO) from your employer. You usually get extra benefits, like dental, vision, or gym memberships.

So, what’s the catch? In most cases, you must stay within the plan’s network of doctors and hospitals.

Medicare Supplements work differently. These plans, sometimes called Medigap, help cover the costs that Original Medicare doesn’t fully cover, like copayments, coinsurance, and deductibles. They don’t offer extra perks but allow you to choose any doctor who accepts Medicare.

The most important thing to understand about supplemental Medicare insurance is that it provides more complete coverage of your major medical costs. This includes hospitalization, skilled nursing care, doctor and specialist visits, tests, medical supplies and devices, and more.

You can learn more about it on our Guide to Comparing Medicare Supplement Plans page.

Medicare Advantage Enrollment Periods

Is your heart set on a Medicare Advantage plan? You have several chances throughout the year to sign up. These are called enrollment periods. Each one has its own rules. This is important because you can’t just change plans whenever you want.

The first chance to join a Medicare Advantage plan is when you become eligible for Medicare. This is called the Initial Enrollment Period. It lasts seven months. It starts three months before your 65th birthday month. It ends three months after the month you turn 65.

But maybe you’ve been enrolled in Medicare for a while and chose to stick with Original Medicare. You can switch to Medicare Advantage during the Annual Election Period (AEP), which occurs every year from October 15th to December 7th. You’ll often here people call AEP open enrollment. Any changes you make during this time will start on January 1st of the following year.

Some exceptions let you change plans outside of these times. This might be because you moved to a new area, your health changed, or you qualify for extra help with Medicare costs. You may be eligible for a Special Enrollment Period to get a new plan in these cases.

Conclusion

Comparing Medicare Advantage plans based on the above factors will give you valuable knowledge. Understanding the types, key factors to compare, and extra tips should equip you to pick a plan that suits your budget and healthcare needs.

You can compare Medicare Advantage plans in your area by entering your zip code below. This will take you directly to a list of Medicare Advantage plans in your area.