Enrollment and eligibilityHow to switch from Original Medicare to Medicare Advantage
If you're thinking about your Medicare options and are concerned about cost, you'll be happy to know that some Medicare Advantage plans require no monthly premium. That's right—zero dollars per month—and that could include coverage of services that are not covered under Original Medicare. You’ll still need to pay your Part B premium.
You might wonder how private insurance companies can afford to offer zero-premium Medicare Advantage plans. After all, with Original Medicare the Part B (medical insurance) premium for 2019 is $135.50.
Part B helps cover certain doctors' services and other outpatient care and medical supplies. (If you or your spouse paid Medicare taxes while working, you usually don't have to pay a monthly premium for Part A in original Medicare, which helps cover hospital care.)
Some of the factors that can affect Medicare Advantage premiums include:
- The federal government pays the private insurance companies that offer Medicare Advantage plans a flat monthly fee to cover the cost of each member's healthcare coverage.
- To help control costs, Medicare Advantage plans usually enter into contracts with a network of doctors and hospitals. You may have to pay more money outofpocket if you see a doctor outside the network or without a referral from your primary care doctor. If you have certain doctors you want to continue to see, you should find out whether they participate in any Medicare Advantage plan.
- Many Medicare Advantage plans offer highly effective disease management programs that help keep members out of the hospital, further reducing costs.
- If the plan ends up spending less than the flat fee it gets from the government, it can pass the savings to members by lowering the monthly premium to zero or providing additional benefits not offered by Original Medicare, such as routine vision care.
Of course, Medicare Advantage plans that charge no monthly premium aren't really free. They might offset their zero-dollar premiums with higher copayments or coinsurance or other out-of-pocket expenses. Whether or not you consider a zero-premium plan with a high deductible could depend upon your health.
- Having a pre-existing condition does not prevent you from signing up for Medicare Advantage, unless you are on dialysis for end stage renal disease.
- Unlike Original Medicare, Medicare Advantage plans have a yearly limit on how much you pay out-of-pocket. In 2019, that limit was $6,700 for in-network services, although plans can choose to set it lower than the maximum allowed by Medicare.
Maximum out-of-pocket limits only apply to Part A and Part B services. The prescription drug portion of the plan has total out-of-pocket costs, where the member has cost-sharing responsibility. Also unlike Original Medicare, you can't use a Medicare Supplement insurance policy to cover your out-of-pocket costs in a Medicare Advantage plan.
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