It is possible to switch from your Original Medicare plan to an Advantage Plan, but what is the difference between Original Medicare and a Medicare Advantage Plan? Why might one want to make the switch? Can you switch back to Original Medicare? In this blog, we will breakdown answers to set questions.
The federal government administers Original Medicare, a national health care program that consists of two parts: Medicare Part A and Part B. Medicare Part A is known as hospital insurance. It covers eligible costs for your care as an inpatient in a hospital or nursing facility and may cover hospice care. Medicare Part B is your medical insurance that generally covers outpatient services such as doctor’s visits, home health care, and certain preventive services.
Under coverage of Original Medicare, you can receive care from any doctor, hospital, or other providers who accept Medicare. As a beneficiary of Original Medicare, you often have to pay copayments or coinsurance. In general, Original Medicare covers 80% of the costs, and you are responsible for 20% of costs (in form of copayments and coinsurances).
Original Medicare does not include coverage for prescription drugs, except for those that must be administered by a medical professional. Prescription drug coverage is offered through Medicare Part D, and it is a common add part of the Medicare Advantage insurance plan.
The Medicare Advantage program is provided by private insurance companies approved by Medicare to offer healthcare benefits. Because of that, premiums can differ depending on the plan you choose because the insurance company sets all premiums. You will also continue to pay your Part B premium and any premium your Advantage Plan requires.
Medicare Advantage plans are required to provide at least the same coverage as Original Medicare but can provide additional benefits to their members. Many Medicare Advantage plans include Medicare Part D prescription drug coverage, so you receive all of your Medicare benefits in one plan. Additionally, many offer coverage for routine vision, dental and hearing services (DHV services), which is not provided with Original Medicare.
Medicare Advantage plans can set their own rules and guidelines for members. For example, they determine the number of copayments and coinsurance you will pay for covered services. They may require you to choose from a list of selected providers for your health care.
Once you reach a set limit of out-of-pocket expenses, you pay nothing for your covered healthcare costs. This limit varies from plan to plan and can change each year, as well as it varies from insurance carrier to carrier.
Differences between Original Medicare and Medicare Advantage
Here are the key differences between Original Medicare and Medicare Advantage:
- Individuals who enroll in a Medicare Advantage plan will no longer receive their benefits directly from the federal government, but from a private insurance company instead.
- Medicare Advantage gives beneficiaries a wider range of coverage. It covers all that is already covered under Original Medicare and commonly gives additional benefits, such as prescription drug coverage or DHV insurance.
- With Original Medicare, you are responsible for 20% of the costs for services done, and Medicare covers the other 80%. However, with the Medicare Advantage plan, you must still pay the annual Part B premium, but instead of paying 20% coinsurance for visiting the doctor, most Medicare Advantage plans set a copayment amount for doctor’s visits, which means you will pay lower out-of-pocket costs than Original Medicare.
- Original Medicare plans allow you to see any hospital or doctor that accepts Medicare. In contrast, most Medicare Advantage plans have a network of doctors and hospitals you can see. If you seek medical care outside your Medicare Advantage plan’s network, you will likely pay more.
- Medicare Advantage combines both Medicare Part A and Part B into one plan. Moreover, about 90% of Medicare Advantage plans cover prescription drugs. So you own only one plan with wide coverage, unlike Original Medicare, where you have to enroll in every part in particular.
Switching Medicare plans
There are a lot of Medicare beneficiaries that enroll in Medicare Advantage plans and then find out with time that they are not entirely happy with them. Reasons why beneficiaries want to drop their Medicare Advantage plans, are because it is too restrictive (you usually have to go to in-network doctors and hospitals to avoid higher costs), there is no coverage outside the service area, and sometimes beneficiaries need to travel from hospital to hospital which accepts their MA plan. Usually, Medicare Advantage beneficiaries want to switch back to Original Medicare and choose Medicare Supplement plans instead.
You can sign up for Medicare Part A and B back from the Medicare Advantage plan during Annual Election Period or Medicare Advantage Open Enrollment Period.
The Annual Enrollment Period (AEP) happens from October 15 to December 7 each year. This enrollment period is designed to allow people with Medicare to change their Medicare coverage. You can switch from Medicare Part A and Part B to a Medicare Advantage plan, switch from Medicare Advantage to Original Medicare – Part A and Part B, or switch from one Medicare Advantage plan to another. Changes made during this enrollment period will be effective on January 1st of the following year.
The Medicare Advantage Open Enrollment Period (MA OEP) allows anyone enrolled in a Medicare Advantage plan on January 1 the opportunity to change plans. If you change your mind about your plan selection, you can change to another Medicare Advantage plan or switch to Medicare Part A and Part B during this open enrollment period. The MA OEP occurs between January 1 and March 31. But be aware that you cannot sign up at this time for Medicare Advantage from Original Medicare. You are only allowed to change from one plan to another.
If you realize your Medicare Advantage plan is not for you, making the switch should be quite straightforward.
For any questions, call Temmen Insurance at 417-633-7200.