What Kinds of out of Pocket Costs do Medicare Advantage Plans Have?
Medicare Advantage is a way to get your Medicare benefits through a private insurance company. Medicare Advantage plans typically cover hospital and medical benefits, as well as prescription drugs not generally covered by Original Medicare (Part A and Part B).
Medicare Advantage plans often also have additional benefits, such as coverage for routine dental, routine hearing (including hearing aids) routine vision (including glasses) and fitness benefits. Despite these extra benefits, Medicare Advantage plans usually have lower, not higher, out of pocket costs compared with Original Medicare. You still will generally have some of-out-pocket costs with Medicare Advantage plans, including premiums, copayments/coinsurance, and deductibles.
Medicare Advantage plans out of pocket costs: premiums
A premium is the amount you pay to have insurance, whether or not you use covered services. Medicare Advantage premiums vary from plan to plan.
For example, some plans may charge $54 a month and some may charge $104 a month. Some Medicare Advantage plans may have a premium as low $0.
Regardless of the premium your Medicare Advantage plan charges, you will still have to pay your Medicare Part B premium.
Medicare Advantage plans out of pocket costs: copayments/coinsurance
A copayment is a set dollar amount you pay when you receive a covered service. Coinsurance is a percentage, for example 20% that you pay when you receive a covered service.
The copayment and coinsurance amounts may be different for Medicare Advantage plans and Original Medicare. Services you may pay a copayment or coinsurance for under a Medicare Advantage plan include:
- A visit to a primary care doctor
- A visit to a specialist
- An emergency room visit
- An ambulance ride
- An MRI or CT scan
- Outpatient surgery
- Inpatient hospital days
- Outpatient rehabilitation
- Days in a skilled nursing facility
- Prescription drugs
- Dental services
- Eyeglass lenses
- Chiropractic coverage
- And more
You can usually find out the copayment/coinsurance information before you sign up for the Medicare Advantage plan.
Medicare Advantage plans out of pocket costs: deductibles
A deductible is the amount you must pay before your plan begins to pay. Some Medicare Advantage plans have separate deductibles for medical care and prescription drugs. If your Medicare Advantage plan has a network, only in-network care may apply towards the deductible. Some Medicare Advantage plans have $0 medical deductibles, $0 prescription drug deductibles, and $0 premiums.
Medicare Advantage plans out-of-pocket maximum
Unlike Original Medicare, all Medicare Advantage plans have out-of-pocket maximums. An out-of-pocket maximum can be a reassuring thing because this means you only have to pay up to known amount before all your covered medical costs are paid for. The Medicare Advantage out-of-pocket maximum can vary from plan to plan, although Medicare determines a yearly upper limit for the out-of-pocket maximum.
For example, if you have a surgery that costs $10,000, but your out-of-pocket maximum is $3,000, you will only have to pay $3,000 or less for the surgery. You may have to pay less if you already paid for other services that also helped count to your out of pocket maximum.
Other things that might affect Medicare Advantage out of pocket costs
Many Medicare Advantage plans come in the form of a managed care plan, such as a Health Maintenance Organization (HMO) or Preferred Provider Organization (PPO*). These types of plans have networks of approved doctors and providers. An HMO may only pay for the care you receive in network. PPOs may allow you to go out of network but you will generally pay more for out of network services.
Medicare Supplement plans help cover Medicare out-of-pocket costs such as copayments, coinsurance, and deductibles. However, Medicare Supplement plans only work with Original Medicare. You cannot use Medicare Supplement with Medicare Advantage.
Do you have any questions about your Medicare Advantage plan costs? Feel free to use the eHealth plan finder tool on this page to browse Medicare plan options for Medicare Advantage.
*Out-of-network/non-contracted providers are under no obligation to treat Preferred Provider Organization (PPO) plan members, except in emergency situations. For a decision about whether we will cover an out-of-network service, we encourage you or your provider to ask us for a pre-service organization determination before you receive the service. Please call our customer service number or see your Evidence of Coverage for more information, including the cost-sharing that applies to out-of-network services.