Medicare Advantage is sometimes called "Medicare Part C" - but it's not something you add to Original Medicare. It's a different way to get your Medicare benefits. Instead of the government paying your claims directly, a private insurance company manages your coverage.
Today, about half of all Medicare beneficiaries choose Medicare Advantage over Original Medicare.
What Medicare Advantage Covers
Every Medicare Advantage plan must cover everything Original Medicare covers:
- Part A: Hospital stays, skilled nursing, hospice
- Part B: Doctor visits, outpatient care, preventive services
Most plans also include:
- Part D: Prescription drug coverage
- Dental: Routine cleanings, X-rays, sometimes major work
- Vision: Eye exams, glasses allowance
- Hearing: Hearing tests, hearing aid discounts
- Fitness: Gym memberships (like SilverSneakers)
- OTC allowance: Monthly credits for over-the-counter items
- Transportation: Rides to medical appointments
Medicare Advantage plans have annual out-of-pocket maximums (typically $3,000-$8,000 for in-network care). Once you hit this limit, the plan pays 100% of covered services. Original Medicare has no out-of-pocket maximum - your costs can keep growing without limit unless you have supplemental coverage.
Medicare Advantage vs. Original Medicare
| Feature | Medicare Advantage | Original Medicare + Medigap |
|---|---|---|
| Monthly cost | $0-$100+ plan premium (plus Part B) | Part B + Medigap ($100-$300+) + Part D |
| Out-of-pocket max | Yes ($3,000-$8,000 typical) | No (unless Medigap covers it) |
| Doctor network | Must use network (HMO) or pay more (PPO) | Any Medicare provider nationwide |
| Referrals | Often required for specialists (HMO) | Never required |
| Extra benefits | Dental, vision, hearing, fitness often included | Not included (buy separately) |
| Drug coverage | Usually included | Separate Part D plan required |
| Best for | Those who want lower premiums, extra benefits, and are OK with networks | Those who want freedom to see any doctor and travel frequently |
Types of Medicare Advantage Plans
HMO Health Maintenance Organization
How it works:
- Must use doctors and hospitals in the plan's network (except emergencies)
- Need referrals from your primary care doctor to see specialists
- Lower premiums and costs than PPO
- No coverage for out-of-network care (except emergencies)
Best for: People who have doctors in the network and prefer lower costs over flexibility.
PPO Preferred Provider Organization
How it works:
- Can see any doctor, but pay less for in-network providers
- No referrals needed for specialists
- Out-of-network coverage available (at higher cost)
- Higher premiums than HMO
Best for: People who want flexibility to see out-of-network doctors or travel frequently.
The $0 Premium Question
Many Medicare Advantage plans advertise "$0 premiums." This is real, but understand what it means:
- You still pay your Part B premium ($174.70+ in 2024)
- You'll have copays, coinsurance, and deductibles when you use care
- The plan is paid by Medicare based on your expected healthcare costs
$0 Premium Plan Costs: Robert has a $0 premium Medicare Advantage HMO. His plan has a $0 deductible, $10 copays for primary care, $45 for specialists, and $295/day for hospital stays (days 1-5). His out-of-pocket maximum is $4,500. If he stays healthy, he pays almost nothing. If he has a major health event, his costs are capped at $4,500.
Don't choose a plan based on premium alone. A $0 premium plan with high copays could cost more than a $50/month plan with lower cost-sharing if you use a lot of healthcare.
Things to Consider Before Choosing
- Check your doctors: Are your current doctors in the plan's network?
- Check your medications: Are they covered on the plan's formulary?
- Consider your travel: HMO plans typically don't cover non-emergency care outside the service area
- Review the fine print: Look at copays, coinsurance, and the out-of-pocket maximum
- Switching back can be hard: If you leave Medicare Advantage for Original Medicare, you may face medical underwriting for Medigap
When Can You Enroll?
Initial Enrollment Period: 7 months around your 65th birthday (3 months before, birthday month, 3 months after)
Annual Enrollment Period: October 15 - December 7 each year. Changes take effect January 1.
Medicare Advantage Open Enrollment: January 1 - March 31. Only for people already in Medicare Advantage who want to switch plans or return to Original Medicare.
Want to Explore Medicare Advantage Options?
Our team can help you compare plans available in your area and find one that fits your doctors, medications, and budget.
Get Free HelpFrequently Asked Questions
Can I have Medicare Supplement and Medicare Advantage?
No. You must choose one or the other. If you have Medicare Advantage, a Medigap policy won't pay anything. If you want Medigap, you need to be on Original Medicare (Parts A and B only).
What happens if I move to a different state?
Medicare Advantage plans are local. If you move outside your plan's service area, you'll qualify for a Special Enrollment Period to choose a new plan in your new location. This is one reason some people prefer Original Medicare with Medigap, which works nationwide.
Are Medicare Advantage plans really "free"?
No plan is truly free. Even with a $0 premium, you pay your Part B premium and have cost-sharing when you use services. The insurance company receives payment from Medicare to cover your care. Think of it as pre-paid rather than free.
Can my Medicare Advantage plan drop me?
Plans cannot drop you for health reasons. However, plans can exit your area or close altogether. If this happens, you'll have a Special Enrollment Period to choose new coverage. You'll receive notice if your plan is leaving your area.