If you elect to go with Medicare, you will get Part A (hospital), Part B (doctor visits/outpatient care) and Part D (prescription drugs). If you decide to go with Part C, a Medicare Advantage plan, a plan will be bundled for you along with Parts A and B.
Let’s look further into these two options and which one is best for your needs.
Going to the Doctor
Under Original Medicare, you can choose any providers who accept Medicare. Thankfully, 93 percent of non-pediatric primary care doctors accept Medicare. However, 30 percent of primary care doctors are not accepting new Medicare patients, so be sure to check on this before switching doctors.
With Medicare Advantage, things are a bit different depending on whether you have an HMO or PPO. In 2018, 68 percent of MA plans offered were HMO, compared to 27 percent for PPO. If you go with an HMO plan, be aware that you’ll be limited to a specific network of hospitals and doctors.
Medicare covers most medical needs, with the exception of vision, dental and hearing. Fortunately, you can pick up a supplemental plan to cover these services. Under Medicare Advantage, you get all the same services as you do with Original Medicare, as well as some coverage for dental, vision and hearing.
While MA plans do look attractive, there are some pitfalls to be aware of. For example, you must follow specific plan rules to get coverage, you’re limited on the doctors you can see and you may have trouble getting emergency care due to rationing. And unfortunately, some private plans are not financially stable and may suddenly stop providing coverage.
With Original Medicare, the federal government sets the premiums, deductibles and coinsurance for Part A and Part B. For example, you are responsible for 20 percent of a doctor visit or lab bill. Many people choose to take out a supplemental plan to help pay for these costs.
Medicare Advantage plans work a little differently. You will still have to pay the government-set premiums, but instead of paying 20 percent coinsurance, your plan will probably have a set copay amount. This can lead to lower out-of-pocket costs, though not always.
Do be aware that hospitalizations, some outpatient services and medical equipment often cost more under MA plans. This article also points out that there are financial incentives to limit services since MA plans receive set fees from the government and can lose money.
While there are some great features to Medicare Advantage plans, we generally do not recommend them. You’re far more limited on choice, your out-of-pocket costs can quickly add up and you have to follow specific rules to get covered care.
Your best option is Original Medicare along with a supplemental plan that fills in the gaps and helps cover out-of-pocket costs. To discuss your options for Medicare and Medigap plans, contact Leonard Financial Solutions today.