If you are over age 65, understanding your Medicare options can be a challenge. If you have paid into Social Security for at least 10 years, you are automatically enrolled in standard Medicare (Parts A and B) once you begin collecting Social Security benefits at age 65. Medicare Part A covers some hospital expenses, while Part B covers doctor visits and expenses such as lab tests and some screenings.
Medicare Part C, also known as Medicare Advantage, offers comparable coverage to standard Medicare, but usually includes prescription drug coverage (available to customers with standard Medicare who choose to purchase an additional Medicare Part D Plan). When trying to decide between Medicare and Medicare Advantage, consider these five things: cost, coverage, pre-existing conditions, the power of choice, and convenience.
Since private insurance companies offer Medicare Advantage plans, customers can shop around to compare pricing and plans so that they find the coverage that works best for their particular needs. Most plans cover prescriptions and have an annual “risk” cap that keeps the amount you spend yearly on deductibles and co-pays under control.
Plan pricing may change every year. Remember to review your coverage annually, before the Annual Open Enrollment Period, to make sure your current plan continues to meet your insurance needs.
Excluding hospice care, the US government requires that all Medicare Advantage plans cover the same services that Medicare Parts A and B cover. Hospice care for Medicare Advantage customers is still covered under standard Medicare.
Although Medicare Advantage covers all emergency and urgent care, private providers choose whether to cover services deemed not medically necessary under Medicare. Check with your provider to determine if your plan covers services you may require, such as vision, dental, hearing, and preventive care.
3. Pre-existing Conditions
All Medicare beneficiaries, including those enrolled due to disability, enjoy guaranteed Medicare acceptance. The single exclusion is patients with end-stage renal disease. Rules established under the Affordable Care Act stipulate that:
- Pre-existing conditions may not be considered at time of enrollment
- Pricing relies on regional standards rather than age
- Recipients have protection from catastrophic out-of-pocket costs
4. The Power of Choice
Insurance providers offer a wide variety of Medicare Advantage plans, each with variations in coverage and pricing. In addition to the Medicare Advantage Prescription Drug Plan, providers offer customers six possible plan types. The most well known plans are Health Maintenance Organization (HMO) and Preferred Provider Organization (PPO). Others include Private Fee For service (PFFS) and Special Needs Plans (SNP).
Two other options are less common and not available with every Medicare Advantage provider. HMOPOS is an HMO Point of Service plan that allows some out-of-network services, albeit at a higher cost. MSA is a Medical Savings Account plan that pairs a high deductible plan with a bank account into which Medicare deposits funds that you can apply to healthcare costs during the year.
Healthcare decisions vary by person. Medicare beneficiaries with pre-existing conditions may prefer to continue receiving care from a known, trusted physician or facility. Others value the convenience of a simple, comprehensive plan, such as a Medicare Advantage plan that includes both hospital and regular medical coverage, as well as prescription, vision, and other services.
Understanding the variety of healthcare options available for Medicare coverage can be overwhelming. The simplicity of choosing a single, comprehensive plan like Medicare Advantage may save more than money; it can also save time and sanity. When making your choice, consider your health needs to determine the benefits that best serve you, and review your coverage yearly to make necessary changes.