MEDICARE NEWS

What are the different types of Medicare Advantage plans?

Many Medicare beneficiaries opt to boost their coverage by adding an Advantage Plan. Our team took a look at what kinds of plans are available.

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What are the different types of Medicare Advantage plans?
ERIC BARADAT AFP

According to the Congressional Research Service, in 1966, when the bill which established Medicare was passed, “only about half of the nation’s seniors had health insurance.” To increase coverage for the nation's seniors, Medicare was established with two ‘Parts: Part A, which provided “coverage for hospital and posthospital services,” and Part B, which covered doctor’s visits and other medical services.

In 2003, Congress approved the Medicare Modernization Act of 2003, which greatly expanded the role of private insurance in Medicare. The law established Part C, which allowed for the creation of Medicare Advantage Plans.

These plans allow those eligible for Medicare to purchase private healthcare plans that include benefits like vision and dental, which are not included in a standard Medicare plan.

Enrollment in Medicare Advantage Increases

Since the establishment of Part C, the number of people enrolled in Medicare Advantage Plans has steadily increased. Today, nearly a third of all Medicare beneficiaries are enrolled in a Part C plan. Those registered in a Medicare Advantage plan pay additional monthly premiums, the cost of which depends on the healthcare market where they live.

The Commonwealth Fund, a non-partisan research organization, found that since 2003, enrollment in Medicare Advantage plans grew from 4.6 million “to 18.5 million in 2017." Researchers were also able to track an increase in enrollment from more diverse backgrounds, including younger beneficiaries and those from low-income backgrounds.

Selecting a Plan

The Congressional Research Services released a report on Medicare in 2020, which highlighted that most Medicare beneficiaries live in areas where they have access to a Medicare Advantage plan. One can use Medicare’s Plan Finder to get quotes specific to their areas.

After being asked for a zip code, the tool prompts users to report any additional income or benefits they receive from the federal government (Medicaid, Supplemental Security Income, Medicare Savings Program, Extra Help from Social Security).

Then, one will be asked whether they would like to compare drug prices depending on the various plans. This could be important for those reliant on daily or costly prescription drugs. Some plans may offer lower deductibles or different prices for prescriptions based on the way costs are distributed.

What types of plans are available?

Once you have filled out the questionnaire, various plans will be selected based on the responses. There are helpful tools that allow users to quickly gather information about which benefits are included under the plan. This includes data on premiums, deductibles, prescription drugs, and other plan benefits (vision, dental, hearing, transportation, fitness, worldwide emergency, telehealth).

Premiums and Deductibles

Many Medicare Advantage Plans do not have a premium. But it is crucial to keep in mind that Part B premiums will still have to be paid. In 2021, the Part B Standard Premium was $148.50 and is taken directly out of one’s social security checks.

Some Advantage plans do have premiums as high as $200.

With deductibles and other fees, it is important to see how much the plan will require you to pay as it relates to:

  • Health Deductible: "The amount you pay for covered services before your plan starts to pay any costs." 
  • Drug deductible: "The amount you pay for drugs before your plan starts to pay any drug costs."
  • The maximum you pay for health services: "Once you pay this amount in deductibles, copays, and coinsurance for services, your plan pays 100% for covered health services,

 

The tool also offers reviews on each of the plans related to different factors, including how those with chronic conditions view the plan and how easy it is to schedule a doctor’s appointment.