Today we’re going to talk about the types of Medicare plans and how to decide which one is best for you. Part of the confusion among people turning age 65 or that are new to Medicare is that you’re getting bombarded with so much marketing whether it’s by mail or phone calls, it’s just information overload. It’s tough to know where to begin!
There are so many different plans and insurance companies, but first you need to know that there are two plan types – Medicare Supplement also known as Medigap, and Medicare Advantage. Once you know which type of plan you prefer, then you can look further into the specific plans under that category type to narrow your choices down to one or two plan options that should work for you.
So once you’ve narrowed it down, it’s easy to choose one, just by answering a few questions related to your specific medical needs and your lifestyle.
Medicare is a government program for people over the age of 65 and with certain disabilities.
Parts Of Medicare
There are PARTS of Medicare and PLANS of Medicare.
The 4 Parts of Medicare are Part A, Part B, Part C, and Part D. I’ll explain these parts briefly and this will give you a better understanding when we talk about the types of Medicare plans.
Part A is inpatient coverage when you’re in the hospital. It includes your room and inpatient hospital care. It also covers skilled nursing facility stays, hospice, and home health care. There’s a deductible associated with Part A and this can change every year. For most people, there’s no cost for Part A. If you worked at least 40 quarters in your lifetime and paid taxes then your Part A is considered paid up and you’ll pay zero $0.
Part B of Medicare covers outpatient medical such as Dr visits, lab work, tests, surgeries, durable medical equipment, and preventive services. You must sign up for Part B and pay a monthly premium. Certain people with lower incomes may qualify for assistance that covers the Part B premium for them. The cost for Part B can change every year.
Part C is called Medicare Advantage which are privately run health insurance plans. This is a bundled all in one type of plan that includes Part A, Part B and most of the time Part D into one plan.
Part D is Prescription drug coverage. These plans help cover the cost of medications including shots and vaccines. Part D plans are also run by private insurance companies but are still regulated by the government.
Medicare is great coverage that you’ve paid into your whole life, but it does have its gaps and holes. Medicare pays up to 80% of your medical costs and you’re responsible for the remaining 20%.
This 20% is an unlimited amount with NO cap on how much you could be billed for. It’s a lot of risk you’d be taking if you only have Medicare Part A & B without any kind of supplement.
Two Coverage Options
You have two options for your Medicare supplemental coverage.
Medicare Supplement Plans
The first option is to stay with original Medicare Part A & B and add a Medicare Supplement also called Medigap plan and also a Part D Drug plan. The great thing about Medicare supplement plans is that there are no networks, you can see any doctor nationwide that accepts Medicare. You also have coverage if you travel outside the US.
Medicare Supplements help fill in the gaps and holes of Medicare. They pay the deductibles and coinsurance that Medicare Part A and Part B don’t cover. There are 10 different plans that are lettered A through N. They don’t include part D prescription drug coverage. You’ll need to purchase a prescription drug plan in addition to your Medicare Supplement Plan.
Medicare Advantage Plans
The second type of plan, and an alternative to a Medicare Supplement, is called Medicare Advantage. This is a bundled type of plan where you will still need to have Part A and B but you don’t need to buy a separate Medicare Supplement or Drug plan.
You will still need to keep paying for your Part B no matter which type of plan you choose, Medicare Supplement or Medicare Advantage.
Medicare Advantage also known as Part C of Medicare has Parts A B and D combined.
Medicare Advantage Plan Types
There are 6 different types of Medicare Advantage plans. These are network type plans, with the most popular being HMO’s & PPO’s. These plans are similar to the coverage you’ve always had through an employer while working and under age 65.
With a PPO you can see doctors and providers IN the network AND out of the network. If you go out of the network then you’ll typically pay more for services. And with a PPO, you won’t need a referral to see a specialist.
With and HMO the plan pays for care received inside the plans’ network and if you go out of the network you’ll pay 100% out of pocket. Also with some HMO’s you’ll need a referral to see a specialist.
Medicare Advantage Out Of Pocket Costs
There can be out of pocket costs with Medicare Advantage. These costs will be in the form of copays or a coinsurance percentage that you’ll pay for your medical care. There’s an annual maximum out of pocket on each plan. This puts a cap on the total amount you can be billed each year.
Most Medicare Advantage plans include Part D prescription drug coverage. Sometimes there’s extra benefits included in the plan such as dental, vision, health and wellness products, and gym memberships. You may also be able to find a Medicare Advantage plan that has a 0 dollar premium, depending on the area where you live.
It’s important for you to know that benefits can vary from Plan to Plan and also by the county where you live, so not all types of plans may be available in your area. This is something that we can help you with, we have access to all the plan options in your area.
How to Choose A Medicare Plan
So how do you choose which Plan type is best for you? Well that depends on a few things. Some good questions to ask yourself would be:
- Do you want the freedom to choose your own doctors? Or maybe you don’t staying within a network of Doctors and hospitals.
- Do you travel outside of your area? Some plans will only cover you on an emergency basis if you’re out of the network area.
- Is it going to be affordable? Would you rather keep your monthly premiums lower and then pay as you go for services? Or, would you rather pay a higher amount each month but have peace of mind knowing you’ll be covered no matter what, while having a predictable cost every month?
The answers to these questions will help you determine which type of plan will work best for you. If you have any questions please call us at (800) 783-5901 or email us at firstname.lastname@example.org , our service is 100% free and we’re happy to help you.