When it comes to Medicare, I think we all know that things can get a little confusing. If you’re a newbie to Medicare, you might need some help navigating through all the different plans and options available to you. One of the biggest decisions you will need to make is to enroll in an original Medicare vs. Medicare Advantage plan.
There are pros and cons to each type of plan, but it can be difficult to figure out which plan is best for you. If you don’t want to read the rest of this post, let me give it to you short and simple: If you’re typically healthy, choose Medicare Advantage, and if you get sick, choose an original Medicare plan.
Breaking Down Medicare
Now, we all know that nothing in life is that simple, so let’s try to break this complex Medicare stuff into digestible chunks.
Medicare is divided into four parts: A, B, C, and D. Parts A, B, and D make up original Medicare, while Part C is Medicare Advantage. Here’s a quick rundown of the plans:
- Part A: Covers hospitalization and there is no monthly charge. After a $1,316 deductible, you will be covered for 60 days of hospitalization before you will need to provide copay.
- Part B: Covers doctors, devices, outpatient surgeries, and other medical services. Typically, a $183 deductible paid annually will cover about 80 percent of medical bills.
- Part C: This is Medicare Advantage and is to be used as a substitute for the other plans. Costs and coverage will vary depending on your provider.
- Part D: Plan that covers prescription drugs. Since Medicare subsidizes it, a private insurance provider will determine the price you pay for your medications.
Original Medicare vs. Medicare Advantage
When it comes to Original Medicare vs. Medicare Advantage, there are some fundamental differences between the plans. Original Medicare is a fee-for-service plan, allowing members to use any hospital, doctor, or medical provider that accepts Medicare. There are a growing number of health care providers that accept Medicare, so this gives you many options. Most people that enroll in Medicare will have to pay for other supplemental policies to fill gaps in coverage and prescription drugs.
Medicare Advantage, on the other hand, is structured more like a traditional company health plan. This means that you would have a limited network of doctors and hospitals to choose from. Though there are copays, deductibles, and out-of-pocket maximums that come with Medicare Advantage plans, they do tend to cover prescription drugs – to an extent. These plans tend to be less expensive and some plans don’t even charge anything beyond the monthly charge Medicare beneficiaries pay.
Tips for Medicare Newbies
So, we know the difference between the various Medicare plans – now what? When it comes to Original Medicare vs. Medicare Advantage, there a few things that a Medicare newbies should know.
The first thing you need to know is that there is a deadline to sign up for Medicare and if you miss it, you may end up paying more for Medicare. This Initial Enrollment Period contains the 3 months preceding your 65th birthday, the month of your 65th birthday, and the three months after you turn 65. If you fail to sign up for Medicare during this period, you may end up paying more for services for the rest of your life.
If you miss your initial enrollment period, you can still apply during open enrollment, which is between January 1 and March 31 of each year. If you sign up late, you WILL pay more for coverage.
Another thing that newbies can get caught up on is Medigap insurance coverage. This is the supplemental plan that you can purchase to cover gaps in your Medicare plan. If you buy Medigap insurance coverage within 6 months of enrolling in Part B after age 64, the companies must sell it to you without regard for your health. If you wait, you could be denied or charged more.
Tying it All Together
There isn’t one particular plan that is best for all seniors. When it comes to Original Medicare vs. Medicare Advantage, you need to weigh your options. Medicare is an incredibly complex program and seniors that are unaware of how it works are likely to be taken advantage of.
For more information regarding Medicare, you can visit their website, or speak with an elder care manager that can help you get the coverage you need.
April 30, 2019
Great article. As a Medicare Insurance agent I hear many times that seniors just get confused with all of the information they are sent in the mail. Articles like this and companies like mine help seniors understand what Medicare Insurance is all about.