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What is a Medicare Advantage Plan and Do You Need One?

Making the transition from conventional insurance to Medicare is a pretty big deal. And while we think it should be simple, sometimes the differences can be rather confusing.

However, no one wants to be stuck with medical bills they can’t handle. That’s why it is important to understand what’s covered and what’s not.

We’ve talked about the four parts of Medicare before, so you’ve likely heard of “Medicare Advantage” or “Medicare Part C.” To ensure you receive thorough coverage, it may be necessary to purchase one of these plans. That’s why understanding your options is such an important part of signing up for Medicare.

The Basics: Original Medicare

As we’ve mentioned, Medicare Part A is basically just hospital insurance. If you’re admitted to a hospital, this is what covers the cost of your stay. However, there is still a deductible involved.

Also, if you end up hospitalized for any extended period of time, there is a limit to what it covers. You could end up being liable for hundreds of dollars per day out of your own pocket.

Medicare Part B has a set monthly premium. It will cover a portion of things like seeing your doctor, having tests taken, and some medical supplies. The deductible is low, but you’re still responsible for 20% of your health care costs.

Extended Coverage: Medicare Advantage

You could simply opt to take Original Medicare by itself, but you should be aware of its limitations. An Advantage Plan, on the other hand, will give you greater coverage.

Advantage Plans are provided by private insurers and are not managed by the government. This makes them a bit more like conventional insurance policies. These plans are also like add-ons, as you’ll still have the benefits of part A and B.

Just like traditional insurance, with Advantage Plans, you can shop around. This way you can chose a plan that suits you and fits your budget. Different plans have different features, and some even include things like hearing, dental, and/or vision coverage.

Of course, the more coverage you get, the higher your premiums will be.

Types of Advantage Plans

When it comes to Advantage Plans, there are several different types. These include PPOs (Preferred Provider Organizations) and HMOs (Health Maintenance Plans) – sound familiar? Yep, it’s pretty much the same as buying regular old insurance.

There are also Special Needs Plans. These are for people who have various chronic conditions that need ongoing treatment. And, additionally, there are HMO Point of Service Plans and Medical Savings Accounts as well.

Again, all Advantage Plans include the coverage from Medicare Parts A & B, so you’ll always have those benefits.

One major benefit to enrolling in an Advantage Plan is that they include annual out-of-pocket maximums. If you’re seriously injured or become ill, these plans can be a godsend. Once you reach the maximum, these plans can cover 100% of your medical costs for the remainder of the year.

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