Medicare Advantage Explained

What Is Medicare Advantage?

Medicare Advantage, also called Medicare Part C, is an alternative way to receive your Medicare Part A and Part B benefits through a private insurance company approved by Medicare.

You still have Medicare.

However, instead of Original Medicare administering most of your healthcare benefits directly, a Medicare Advantage plan administers your Medicare-covered services according to the plan's rules.

You must generally have both Medicare Part A and Part B to enroll in Medicare Advantage and must continue paying your Part B premium.

What Does Medicare Advantage Cover?

Medicare Advantage plans must cover nearly all medically necessary services covered by Original Medicare.

Most also include Part D prescription drug coverage.

Depending on the individual plan, additional supplemental benefits may also be offered, such as certain:

Availability, eligibility requirements and benefit amounts vary considerably by plan.

Additional benefits should therefore be evaluated alongside—not instead of—your medical providers, prescriptions, costs and coverage rules.


Does Medicare Advantage Replace Medicare?

Medicare Advantage does not eliminate your Medicare entitlement.

It changes the way you receive Medicare-covered benefits.

You remain enrolled in Medicare Part A and Part B.

A simple way to understand it is:

Original Medicare: The federal Medicare program administers your Part A and Part B benefits.

Medicare Advantage: A Medicare-approved private plan administers your Part A and Part B benefits.

Do Medicare Advantage Plans Have Networks?

Many do.

Common Medicare Advantage plan structures include:

HMO

You generally receive non-emergency care from providers in the plan's network, subject to plan rules.

PPO

You generally pay less for in-network providers but may have access to covered out-of-network providers at a higher cost, subject to the plan's terms.

HMO-POS

Certain HMO plans may provide limited Point-of-Service benefits allowing designated services outside the network.

Different Medicare Advantage plans can therefore provide very different levels of provider flexibility.





Can My Doctors Leave the Network?

Yes.

Provider contracts and networks can change.

A physician being in-network today does not guarantee that the physician will remain in-network indefinitely.

Before enrolling—and periodically afterward—consider verifying:

Whenever possible, confirm network status with both the health plan and provider.

Do Medicare Advantage Plans Require Referrals?

It depends on the plan.

Some plans require referrals for certain specialist services while others do not.

Prior authorization may also be required for some procedures, tests, medications or other services.

This is different from Original Medicare, where prior authorization is generally less common. Medicare Advantage plans must follow Medicare requirements but may have plan-specific utilization-management procedures.

Does Medicare Advantage Include Prescription Coverage?

Most Medicare Advantage plans include Medicare Part D prescription drug coverage.

These are commonly called MAPD plans.

Some Medicare Advantage plans do not include drug coverage.

Drug formularies, pharmacy networks, deductibles and medication costs can differ substantially between plans, making a prescription review an important part of plan comparison.

Does Medicare Advantage Have a Maximum Out-of-Pocket Limit?

Medicare Advantage plans have an annual limit on what members pay for covered Part A and Part B services.

Individual plan limits vary.

Prescription drug spending under Part D is handled separately under Part D rules.

This annual medical out-of-pocket protection is one notable difference from Original Medicare by itself, which generally has no annual Part A and Part B maximum unless supplemental coverage provides additional protection.

Are $0-Premium Medicare Advantage Plans Free?

No.

Some plans may have a $0 additional monthly plan premium, but beneficiaries generally must continue paying the Medicare Part B premium.

Other costs may include:

A $0 plan premium should therefore never be interpreted as “free healthcare.”

What About Emergency Care?

Medicare Advantage plans must cover emergency and urgently needed care according to Medicare requirements, including when appropriate care is received outside the plan's regular network.

Routine and non-emergency care can have different network requirements.




Who Might Want to Evaluate Medicare Advantage?

It may be worth comparing Medicare Advantage if you value:

However, every beneficiary should evaluate providers, prescriptions, hospitals, costs and plan rules individually.