One of the most common questions people ask me when making their decision is “What is the difference in the two Medicare programs: Original Medicare and Medicare Advantage?”
Original Medicare has one plan accepted by most health care providers in the United States while private Medicare Advantage has many different plans accepted by fewer providers on a case by case basis.
But what about the cost? Cost can determine which plan to pick, but when comparing costs between these two programs please be careful.
When comparing costs, both programs require you to enroll in Medicare A (Hospital), and Medicare B (Doctors) with Part B premiums ranging from $134 per month all the way up to $429 depending on your income.
If you select Part C Medicare Advantage (MA), in addition to paying the Part B premium, you will pay any MA premiums, along with co-pays and deductibles.
Out of pocket costs in a MA plan can be high. In 2017, the average out-of-pocket limit in a MA plan is expected to be about $5,332 with a maximum out-of-pocket limit of $6,700. So while these plans may have low premiums, you can expect to pay more on the back end.
Although, it is often noted that Medicare Advantage plans have a maximum limit of out-of-pocket spending and Original Medicare does not, you can accomplish the same result of limiting your exposure with a supplement plan that picks up the difference of what Medicare does not pay, including the Medicare annual deductible.
If you don’t pick Part C Medicare Advantage, you will pick a Part D prescription plan and a supplement plan.
Original Medicare doesn’t have a maximum out-of-pocket cost. Therefore out-of-pocket costs in Original Medicare plan depend on the supplement plan you pick.
Here’s the bottom line.
With Original Medicare you can keep the doctors and hospitals you know and trust, and have the freedom to use any doctors, medical centers and hospitals in the U.S. that accept Medicare.
What’s the benefit of having a free gym club membership with Medicare Advantage if the plan refuses to pay for your cancer treatment at M.D. Anderson clinic because the lifesaving care recommended by your doctor is not covered in your MA plan’s network?
Original Medicare has stability while MA plans don’t necessarily. Each year the insurance company who offers MA plans can choose whether they want to stay in Medicare or not.
They can also change costs and benefits each calendar year. Under the Affordable Care Act, there was a significant reduction in the way the MA plans are paid which could have an impact with increased costs that beneficiaries may pay in the future.
Original Medicare will always be there for you and your basic plan won’t be dropped or changed.
With Original Medicare, you avoid the hassle factor of having to research other plans every calendar year. If you have a MA plan, you will be required to look for changes in your existing plan. Changes could include increases in cost sharing, premiums and removal of certain medications you currently take from the insurance company’s formulary list.
If you still want to compare premium costs of a Medicare Advantage plan with Original Medicare, I can get you an Original Medicare plan, with a low supplement insurance premium of $35 per month along with a Part D prescription plan of $18 and a maximum out of pocket expense of $2200, compared to a MA maximum out of pocket expense of $6,700.
And best of all, you’ll be in control of your health care choices.
