Learn About Medicare Advantage Costs and Coverage Rules

Medicare Advantage, also known as Medicare Part C, is an alternative way to receive Medicare benefits through a private Medicare approved health plan. These plans generally cover Medicare Part A and Part B services, while many plans also provide additional benefits. Costs and coverage requirements depend on the specific plan selected, its service area, and the healthcare providers used.

Understanding Medicare Advantage Costs

Medicare Advantage costs can differ significantly between plans. Some plans may have a monthly premium in addition to the Medicare Part B premium, while others may charge no additional plan premium. Even when the monthly premium is low, beneficiaries may still have other healthcare expenses when receiving covered services.

Common costs can include:

• Premiums: A monthly amount paid for the Medicare Advantage plan, if applicable.
• Deductibles: The amount a beneficiary may need to pay before certain covered services begin receiving plan cost sharing.
• Copayments: A fixed amount paid for particular services, such as a physician visit.
• Coinsurance: A percentage of the cost that the beneficiary may pay for a covered service.
• Out of pocket limit: Medicare Advantage plans have an annual limit on what beneficiaries pay for covered Part A and Part B services.
• Prescription drug costs: Plans that include Part D coverage may have separate cost sharing for covered medications.

The actual amount a person pays depends on the plan's benefit structure and the services received. Costs may also be different for in network and out of network care.

Understanding Medicare Advantage Coverage Rules

Medicare Advantage plans must cover medically necessary services covered by Original Medicare, although plans can establish certain procedures for accessing care. Network rules are particularly important because many plans require members to use specific doctors, hospitals, and other healthcare facilities.

Coverage requirements may include:

• Provider networks: Health maintenance organization plans commonly require members to use network providers except in certain circumstances.
• Referrals: Some plans may require a referral before a beneficiary can visit certain specialists.
• Prior authorization: A plan may require approval before covering certain services, procedures, or medical equipment.
• Prescription formularies: Plans that include prescription drug coverage generally maintain a list of covered medications.
• Emergency care: Emergency and urgently needed care receive special coverage protections, including situations where using a network provider is not practical.
• Service areas: Plan availability and coverage can depend on where a beneficiary lives.

Because rules vary among plans, beneficiaries should review the plan's Evidence of Coverage and other official documents before receiving services. These documents explain covered benefits, cost sharing, restrictions, and procedures for obtaining care.

Understanding both costs and coverage rules can make Medicare Advantage easier to evaluate. Beneficiaries should consider not only the monthly premium but also provider networks, expected healthcare use, prescription coverage, deductibles, copayments, and the annual out of pocket limit. Medicare Advantage plans can change their benefits and costs from year to year, so reviewing current plan information is important. For authoritative information, beneficiaries can consult Medicare and their specific plan documents.