Healthcare Educators


What Is the Advantage of Medicare Advantage Plans?

by | Oct 29, 2021

CMS expects 29.5 million people to enroll in Medicare Advantage for 2022. That’s almost three million more than the number of enrollees who selected Medicare Advantage for 2021.

Medicare Advantage plans have been surging in popularity. Here’s a look at why.

All-In-One Coverage

Original Medicare consists of two parts: Medicare Part A for hospital insurance coverage and Medicare Part B for medical insurance coverage. In addition to these two parts, enrollees need select a Medicare Part D plan if they want prescription drug coverage. If they want to control their out-of-pocket costs, they’ll also need a Medicare Supplement, or Medigap plan.

That’s four plans.

Medicare Advantage offers an all-in-one coverage option. Page five of the 2022 Medicare & You Handbook explains that Medicare Advantage plans are bundled policies that provide the benefits covered under Medicare Parts A and B, and usually Part D, too. Medicare Advantage plans that include prescription drug coverage are also called Medicare Advantage Prescription Drug (MAPD) plans. There are some Medicare Advantage plans that do not provide drug coverage, but this is less common.

Additional Benefits

Many Medicare Advantage enrollees get access to additional benefits that go above and beyond what’s provided under Original Medicare. Page five of the 2022 Medicare & You Handbooks states that these benefits can include vision care, hearing aids, and dental care.

For enrollees with chronic illness, plans may offer even more benefits. CMS says that the percentage of plans that offer special supplemental benefits for enrollees with chronic conditions is increasing from 19% in 2021 to 25% in 2022.

Out-of-Pocket Maximum

Page six of the 2022 Medicare & You Handbook warns that Original Medicare does not have an out-of-pocket minimum. If you require surgery or hospitalization, you could end up with astronomical medical bills. As page 75 of the 2022 Medicare & You Handbook explains, Medigap can help you with your out-of-pocket costs for covered services and supplies, like copays, coinsurance and deductibles. But if you’re just depending on Original Medicare, there’s no cap to what you could owe.

In comparison, Medicare Advantage plans have an annual out-of-pocket limit. Once you reach that limit, you will not have to pay another penny for any services covered under Medicare Parts A and B for the rest of the year.

Affordable Premiums

Given all of these advantages, you might think that the premiums must be expensive. That’s not necessarily true.

When you enroll in Medicare Advantage, you are still required to pay your Medicare Part B premium. On top of this, you may be required to pay an additional premium for the Medicare Advantage plan. CMS says the average Medicare Advantage premium is expected to be $19 per month in 2022.

Some plans will charge higher premiums, and some will charge lower – or even $0 – premiums. When you consider all the prescription drug coverage, hearing, dental, vision and other benefits that can come with a Medicare Advantage plan, this sounds like a good deal.

So What About Drawbacks?

We’ve covered the advantages, so what about the disadvantages? Although Medicare Advantage plans are attractive for many reasons, there are some potential issues to consider.

First of all, the benefits vary. If you’re looking for prescription drug coverage and other specific benefits, check the plans details to make sure you’re getting the coverage you want.

The costs can also vary. In addition to the premium, the copays and other out-of-pocket costs can also vary from plan to plan. When comparing plans, think about the care that you expect to need in the coming year, and calculate what you think your total costs will be under different plans.

Also, Medicare Advantage plans usually use networks of doctors and healthcare facilities. If you go to a provider who’s not in your plan’s network, your care might not be covered. Before enrolling in a plan, check whether your favorite doctors, specialists, and facilities are considered in-network.

Need Guidance?

The licensed agents at Medicare Educators are here to help. Contact us to schedule a free online or in-person coverage review.