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How May Medicare Advantage Plans Help You Save Money?

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If you’re on Medicare and want to save money on health-care costs, you might want to take a look at Medicare Advantage plans. There may be a wide range of costs among plans, though, so you’ll want to do your research and compare plans.

What are Medicare Advantage plans?

The Medicare Advantage (Medicare Part C) program lets you get your Medicare Part A and Part B benefits through a private, Medicare-approved insurance company. Medicare Advantage plans administer these benefits, and often have extra benefits as well – such as routine dental care.

Most Medicare Advantage plans also include prescription drug coverage, which sets them apart from Original Medicare (Part A and Part B). Original Medicare typically only covers prescription drugs in limited situations, such as in a hospital or clinic.

How might a Medicare Advantage plan save you money?

First, it’s important to understand that there are several different kinds of Medicare Advantage plans, and costs can vary even among plans of the same type.

One way a Medicare Advantage plan might save you money is if you find a plan in your area that includes the extra benefits that you need. For example:

  • Do you have glasses? Some plans may cover routine vision care.
  • Do you need dental insurance? Some plans may cover routine dental care.
  • Do you like to stay active at the gym? Some plans may include gym memberships or fitness programs.

Medicare Advantage Health Maintenance Organization (HMO) plans

One type of Medicare Advantage plan may generally have lower costs than other types. Medicare Advantage Health Maintenance Organization (HMO) plans can have premiums as low as $0 per month. (Other types of Medicare Advantage plans can also have $0 premiums.)

HMOs generally require you to visit doctors within the plan’s network. The HMOs contract with network providers to provide services at a certain cost. By managing costs in these ways, HMOs may be able to offer lower-cost plans to Medicare beneficiaries.

Medicare Advantage HMO plans also generally:

  • Require you to choose a primary care physician
  • Require you to get a referral if you want or need to see a specialist
  • Might require you to get prior authorization before getting certain services

What else should I know about Medicare Advantage plans?

  • Medicare Advantage plans may have cost-sharing amounts for you to pay, such as coinsurance, copayments, and annual deductibles. The average monthly premium for a Medicare Advantage plan was $8 in 2019, according to eHealth research.

Average Monthly Premium by Product

  • You need to be enrolled in Medicare Part A and Part B to be eligible for a Medicare Advantage plan.
  • You must live within the plan’s service area.
  • Every Medicare Advantage plan has a maximum out-of-pocket spending limit per year. If you spend up to that limit on covered health-care services, the plan may cover your approved medical costs for the rest of the year. The average out-of-pocket maximum was $5,164 in 2019, down from $5,815 in 2018 according to eHealth research.

Medicare Advantage Out of Pocket Maximum

  • Medicare Advantage plans have certain times when you can sign up. Read about Medicare enrollment periods.
  • When you have a Medicare Advantage plan, you’re still in the Medicare program. You’ll still need to pay your monthly Part B premium, as well as any premium the plan may charge.

Ready to start comparing Medicare Advantage plans? One easy way is to just use the Browse Plans button on this page.

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