Advantages and disadvantages of Medicare Advantage
Advantages and disadvantages of Medicare Advantage, These popular plans may have hidden risks. This is what you need to know.
If you’re one of the 63 million Americans enrolled in Medicare, you’re likely to be flooded with offers for Medicare Advantage plans, which offer managed care at low or no premiums.
Medicare’s fall open enrollment season begins October 15 and ends December 7, when you can switch your coverage between Original Medicare and Medicare Advantage, switch Medicare Advantage plans, or make changes to your prescription drug plan.
All that advertising seems to be working. Recently, 42% of Medicare beneficiaries signed up for Advantage plans, compared to 31% in 2016, according to data from the Kaiser Family Foundation. Those numbers include 50% of African Americans and 54% of Hispanics enrolled compared to 36% of whites in 2018. By 2025, half of Americans are expected to have Advantage plans.
It’s easy to see the appeal of Advantage. Original Medicare doesn’t cover all medical expenses, while Advantage plans have cost-sharing requirements but limit out-of-pocket costs. Plus, they have low premiums and the simplicity of comprehensive coverage.
But Advantage plans can have hidden risks, especially for those with major health problems.
“Some people on Medicare Advantage end up paying unexpected costs when they get sick or find their network doesn’t have the health care providers they need,” says Tricia Neuman, senior vice president at Kaiser.
Your alternative is to choose Original Medicare and add a supplemental or Medigap plan, which covers your out-of-pocket expenses and offers you a greater choice of providers. But you’ll have to pay additional monthly premiums for a Medigap policy, and unless you’re signing up for Medicare for the first time, you could be denied Medigap coverage because of a pre-existing condition.
Clearly, choosing the right option for your needs requires careful research. The following tips can help you choose the best plan for you.