Basics of Medicare Advantage
Medicare Advantage Plans, also known as Medicare Part C, are health plans offered by private insurers that must provide the same minimum coverage as parts A and B of Original Medicare and may also include additional benefits. When you enroll in a Medicare Advantage Plan most of your Original Medicare health services will be provided by and managed by your plan.
How do Medicare Advantage Plans work?
Health Insurance Companies contract with Medicare to provide your Original Medicare Benefits. You must be enrolled in both parts A and B of Medicare and you’ll continue to pay your part B premium in addition to any Medicare Advantage Plan Premium
What do Medicare Advantage plans cover?
Medicare Advantage plans provide coverage equal to or beyond what Part A and Part B of Original Medicare covers, however, your hospice care will stay covered through Original Medicare even you if you enroll in a Medicare Advantage Plan. In addition to providing the same coverage as Original Medicare, a Medicare Advantage plan may provide additional benefits such as routine dental and vision care. Most Medicare Advantage Plans also provide coverage for prescription drugs (Medicare Part D). If you choose a Medicare Advantage plan with Prescription Drug coverage you will not need to buy an additional Part D plan.
There are a number of types of Medicare Advantage Plans Available:
Health Maintenance Organizations
Health Maintenance Organizations, known as HMOs, generally require you to get your care through a network of providers and you’ll usually need a referral from your PCP to see a specialist. They offer affordable premiums and out of pocket costs that are generally lower than PPO and POS plans.
Preferred Provider Organizations
Preferred Provider Organizations, known as PPOs, are similar to HMO plans in that they offer a network of preferred providers. However, you may see providers outside of the plan’s network but you may be responsible for a higher percentage of the costs. You will often not need a referral to see a specialist. The increased provider choice offered by PPO plans means that they are generally more expensive than HMO plans.
Point of Service Plans
Point of Service Plans are also similar to an HMO plan in that you’ll generally be required to get your care from providers in your network. Depending on the plan you may be able to see providers outside of your network but you will likely be responsible for more of the costs. You may also need a referral to see a specialist.
Private Fee For Service
Private Fee for Service Plans (PFFS) are very flexible in that you generally don’t need to use a set network of providers and you likely won’t need to get a referral for specialist care. However, changes to Medicare law meant that some PFFS plans had to create provider networks so it’s important to check a plan’s rules before enrolling to ensure that it’s a good fit for your needs.
Medical Savings Account
MSAs are high deductible health plans with an attached bank account. Medicare deposits a tax-free lump sum into your account, which you can then use to pay your Medical bills. The amount may not equal the deductible of the plan so you may still be responsible for some of your healthcare expenses throughout the year.
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When can I enroll in a Medicare Advantage plan?
You’ll first be able to enroll In Medicare Advantage:
When you’re about to turn 65. You can enroll during your Initial Enrollment Period (IEP). You’re IEP—which lasts for 7 months—begins three months before your birth month, includes your month of birth and continues for three months after your birth month.
7 month Initial Enrollment Period
*Signing up for Parts A and B during months 5-7 may result in delayed coverage.
When you’ve been on Social Security Disability Income (SSDI) for nearly 2 years. You’ll qualify to receive Medicare when you’ve been receiving SSDI payments for 24 full months, however you don’t need to wait until then to enroll! Your 7 month Initial Enrollment Period (IEP) will begin 3 months before the 25th month. So for example, if your 25th month is April, your IEP will begin in January and run until the end of July.
ESRD Exception – You are eligible for Medicare no matter how old you are if you meet all of the following criteria:
- Your kidneys are no longer functioning
- You need regular dialysis treatments or have had a kidney transplant
- One of the following applies to you:
- You have worked the required amount of time under Social Security, the Railroad Retirement Board, or as a government employee
- You are eligible for or already receive Social Security or Railroad Retirement benefits
- You are the spouse or the dependent child of a person who meets either of the requirements listed
- For more information please see Medicare.gov regarding End-Stage Renal Disease
ALS Exception – The 24-month waiting period is waived for Medicare coverage for disabled individuals medically determined to have Amyotrophic Lateral Sclerosis (ALS), better known as Lou Gehrig’s disease. The date of Medicare entitlement is based on the date of a diagnosis of ALS, or July 1, 2001, whichever is later. This provision affects both new and current beneficiaries.
You’ll then have a yearly chance to enroll in a new Medicare Advantage plan, or change plans:
During the Medicare Advantage & Prescription Drug Plan Annual Enrollment Period, if you’re already enrolled in Part A and Part B of Medicare and want to Enroll in a Part C plan, or you already have a Part C (Medicare Advantage) Plan you’ll be able to choose your coverage option between October 15th and December 7th each year.
In some circumstances you’ll be able to enroll in Medicare Advantage outside of your Initial Enrollment Period and Annual Enrollment Period:
If you miss your Initial Enrollment Period to enroll in Original Medicare you’ll be given a chance to enroll during the Part B General Enrollment Period, which runs from January 1st to March 31st. If you enroll in Part B for the first time during the Part B General Enrollment Period, you will then be given an extra opportunity to enroll in a Medicare Advantage plan between April 1st and June 30th, as long as you are enrolled in both Part A and Part B of Original Medicare,
If you experience a qualifying life event: You may be granted a Special Enrollment Period. Special Enrollment Period qualifying life events include life changes such as moving to a new address, returning to the US after living abroad, moving into or out of a managed care facility, leaving incarceration, and many others.
Note: if you are eligible for premium-free Part A, you can enroll at any time once eligible.
When can I change my Medicare Advantage Plan?
The Medicare Advantage Open Enrollment Period runs from January 1 through March 31. During this period a beneficiary can do the following:
- If you’re in a Medicare Advantage Plan (with or without drug coverage), switch to another Medicare Advantage Plan (with or without drug coverage).
- Disenroll from your Medicare Advantage Plan and return to Original Medicare. If you choose to do so, you’ll be able to join a Medicare Prescription Drug Plan.
A beneficiary CANNOT:
- Switch from Original Medicare to a Medicare Advantage Plan.
- Join a Medicare Prescription Drug Plan if you’re in Original Medicare.
- Switch from one Medicare Prescription Drug Plan to another if you’re in Original Medicare.