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Original Medicare vs Medicare Advantage can be a tough choice when you’re new to the federal health program. We help people by providing educational tools so you can make an informed decision when it comes to your healthcare. Below we’ll compare the differences and similarities between these two options so you can make the best choice.
Difference Between Original Medicare and Medicare Advantage
Original Medicare is a health insurance program run by the Federal government. Medicare consists of Parts A and B. Part A is hospital coverage, and coverage includes hospital visits and skilled nursing facilities. Part B is your medical coverage that covers doctors, appointments, labs, medical equipment. Parts A and B have deductibles, copayments, and coinsurance for services.To qualify for Medicare Advantage, you’ll need both Part A and B. Medicare Advantage plans are Part C. Some Advantage plans offer prescription medication coverage.
These plans may also include hearing, vision, and dental benefits. Private insurance companies sell advantage plans. When you choose to enroll in an Advantage plan, your benefits are no longer being managed by Medicare.
The private insurance company gets paid by Medicare to oversee your Part A and B benefits. These private companies control your network of doctors and have various copays.
About one-third of all Medicare recipients enrolled in a Medicare Advantage plan.
How Much will Original Medicare vs Medicare Advantage Cost?
Part A is usually premium-free just as long as you paid into Medicare enough quarters.
There is no out of pocket spending limit with Original Medicare. The coinsurance and deductibles can add up.
Due to this, most beneficiaries elect to enroll in a Medigap plan.
Each Medicare Advantage plan has different benefits. Making it nearly impossible to predict how much you’ll end up spending out of pocket.
The average cost of a Medicare Advantage policy is around $35 per month, but many plans are available for $0. You’ll still need to pay your Part B premiums.
Advantage beneficiaries pay copays for all their health services. The higher copays are how these private insurance companies can afford to offer plans with a low premium.
The most significant difference between Medicare Advantage and Original Medicare is the Maximum out of Pocket limit. Original Medicare doesn’t have a Maximum Out of Pocket, Advantage plans do. Once you hit the maximum limit for the calendar year, you won’t pay any more costs.
Those with a lower Maximum will likely have a monthly premium. Of course, this is dependent on your location and the plans available to you.
The Pros and Cons of Medicare Advantage vs Original Medicare
When deciding between Original Medicare and a Medicare Advantage policy, it’s good to weigh the pros and cons.
Pros of Original Medicare and Part C
Many Advantage plans offer extra benefits like dental, vision, and hearing. Advantage plans offer prescription drug coverage, which is a huge pro to many people. You may even get a gym membership. With an Advantage plan, you will have an out-of-pocket maximum of $6,700 per year.
Cons of Original Medicare and Part C
Medicare Parts A and B do not cover routine hearing, dental, or vision benefits. It doesn’t cover prescription drug costs unless you have Part D. Medicare does not carry a maximum out-of-pocket in the same sense that an Advantage plan offers.Advantage plans don’t cover care outside of the service area, especially not in a foreign travel emergency. They require you to get a referral to see any specialists.Advantage plans can also switch medical and prescription coverage. Your doctor can drop out of your plan’s network at any point in the year. If this happens, you won’t be able to switch plans until an enrollment window comes around. Also, they require prior authorizations for a lot of treatments and services.
Is Original Medicare Better than Medicare Advantage?
Both Medicare and Advantage plans offer many benefits to recipients. The most important thing to consider is your situation is not the same as anyone else’s. To determine the best choice for you, you’ll need to weigh out the costs and your specific healthcare needs.
Medicare Advantage proves to be a popular choice for individuals who want benefits wrapped into one premium. Those who have a rainy-day fund and are okay paying copays for every service may like this option better. But, if you become sick, you may find your rainy-day fund depleted quickly.