What is the difference between Original Medicare and Medicare Advantage?

Turning 65 can be a turning point in your life for many reasons, including healthcare coverage. You are now eligible for Medicare! You are also eligible for Medicare Advantage and now need to make a choice about which one is best for you. Like most other healthcare coverage decisions, this one can be very confusing for someone new to Medicare (or anyone relying on Medicare and Medicare Advantage for healthcare coverage).

You want to ensure you’re getting the best coverage you can afford but plan documents often make it hard to compare between two different types of coverage. The same thing can be said when choosing between traditional Medicare and Medicare Advantage. The differences between cost, coverage, and available facilities can overwhelm you as you try to choose between the two plans.

Let us break down the differences for you so you can determine for yourself which option is best for you.

Plan Coverage: General

First things first, what does each plan cover and, more importantly, what isn’t covered by each plan?

Let’s start with the original: Medicare. Original Medicare includes your basic hospital and medical insurance (parts A and B, respectively). With this coverage, you can receive care for whatever ails you but, if you need to stay in a hospital or skilled care facility, you will only have coverage for a certain number of days before you pay entirely out of pocket. If you need additional coverage, including vision and/or dental, you will need to shop for a separate plan to cover that need. Some choose to enroll in a Medigap policy (otherwise known as Medicare Supplemental Insurance) while others are able to obtain this coverage through a former employer or union.

Medicare Advantage operates differently. Medicare Advantage is not administered by the federal government. Instead, there are a variety of Medicare Advantage plans that you can purchase through private insurers. These plans will all have a similar level of coverage because they all include Medicare Part A, B, and D coverage (hospital, medical, and drug). The difference is that, because these plans are through private insurers, some will include additional vision and/or dental coverage as a part of that bundle.

Plan Coverage: Doctors and Medical Facilities

When you’re happy with your healthcare, it’s probably in large part due to your doctors, nurses, and other healthcare providers. Your access to those providers is something you need to consider when deciding between Medicare enrollment or enrollment in a Medicare Advantage plan.

The great thing about Original Medicare is that you can go to any doctor, anywhere in the United States that takes Medicare. There are no “in-network” or “out-of-network” providers. If any doctor you want to see takes Medicare, you are able to see that doctor. In most cases, you also won’t need a referral to see a specialist. The same thing goes for hospitals and skilled nursing facilities. If the facility you want to use takes Medicare and you are enrolled in Medicare, you are able to use that facility for your medical care.

However, because Medicare Advantage plans are managed through third-party insurance companies, they have specific networks of doctors that you are allowed to use. If you decide that Medicare Advantage is the right choice for you, make sure to double-check that your favorite providers are considered in-network for your plan. The same goes for hospitals and skilled nursing facilities. They need to be in your insurer’s network for your costs to be covered. If you use an out-of-network provider, you will find yourself facing steeper medical costs than you budgeted for. As for seeing a specialist, it all depends on your plan’s specific terms but, most likely, you will need referrals for those visits.

Plan Coverage: Prescription Medicine

Most people remember to check if their doctors are in-network before switching healthcare coverage, but do you ever stop to check if your prescriptions are covered? If you’re choosing between Medicare and Medicare Advantage, this is something you will want to consider.

If you choose Medicare enrollment, and then decide to add on Medicare Part D, you will be able to choose from a variety of supplemental Part D plans. This allows you to choose the one that has a formulary that covers the brands and medicines that you use on a daily, weekly, or monthly basis.

If you choose to enroll in a Medicare Advantage plan, most of those plans have Part D coverage built-in to the overall plan structure. So, as you peruse the plan to see if your preferred healthcare providers are covered, make sure to remember to peruse the covered prescription drugs as well.

Plan Coverage: Travel

If you have extensive travel plans for your golden years, or if you just want to be able to keep the option open, your choice of Medicare or Medicare Advantage will significantly impact your ability to get healthcare services when you travel.

As mentioned above, Medicare coverage will cover you at any doctor that accepts Medicare anywhere in the U.S. This means you can hop in your RV and cruise to your heart’s content knowing you’ll be able to find a doctor wherever you end up. If your plans take you out of the country, you need to consider purchasing a Medicare supplement plan that would cover international healthcare because Medicare does not.

With Medicare Advantage, you will have to research providers in your travels around the country to ensure you have access to a facility in your destination, just as you would research if your local providers are covered. However, because Medicare Advantage plans are offered through third-party insurance providers, some do provide coverage when you travel internationally.

Plan Cost

Now let’s discuss the issue that most people find the most pressing: how much each plan costs. While there is no direct breakdown that states how much coverage will cost for each individual person, the difference in the cost structures is easily explained.

Let’s start with Medicare. When you enroll in Medicare Part B, you will have to pay a monthly premium. If you receive benefits from the government, such as Social Security, this premium will be deducted from your monthly check. Additionally, you will also pay 20% of the Medicare-approved amount for all medical services and supplies. There is no yearly limit on the amount you pay. If these costs are too high for you to afford, you can enroll in a Medigap plan that will help you cover the out-of-pocket costs.

Medicare Advantage works more like traditional health insurance as these plans are administered by private insurers. Because each plan is from a different insurer, the prices will vary based on your demographic information. You can expect to pay a monthly premium to the insurer in addition to your Part B premiums. However, some plans may have a $0 premium and others may help pay all or part of your Part B premiums. Unlike Original Medicare, these plans will have a yearly limit on what you pay for Part A and Part B covered services. Once you hit that limit, the plan will cover the full cost of any covered care. Also unlike Original Medicare, if you have trouble affording the premiums and out-of-pocket costs, you are unable to purchase a Medicare supplement plan.

Conclusion

Coverage 2 Care understands that choosing the right healthcare coverage for you can be a complicated decision. There are many factors that impact which plan best fits your needs, budget, and lifestyle. Our experienced and professional team of agents want the best for you. That’s why we take the time to discuss the various insurance options with you, and help you determine what plan best fits your individual needs. Give us a call today at 210-361-7096 or contact us via our website and let us sort through the details while you enjoy your golden years.

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