What is Medicare Advantage?*

Medicare Advantage is a comprehensive plan within Medicare that was created to fit the needs of Americans who use Medicare. Like Medicare, it is available to you as soon as you turn sixty-five, as well as if you have certain disabilities or end-stage renal disease.

To answer the question “What is Medicare Advantage?” though, we first must take a look at original Medicare and its benefits.

Original Medicare

Original Medicare, which is government-sponsored healthcare, is offered to all American seniors ages 65 and older or to individuals under 65 with certain disabilities and it comes in two parts: Medicare Part A and Medicare Part B. Medicare Part A covers inpatient services such as hospitalization, nursing facilities, home care, and hospice. Medicare Part B covers outpatient services such as preventative health care and doctor visits.

While a combination of Medicare Part A and Medicare Part B cover most of an individual’s annual health costs, typically only 80% of one’s annual costs are actually covered. If an unexpected illness causes health care bills to pile up, not only may the remaining 20% be a financial burden, but your medical bills could completely exceed Medicare-specified limits, leaving you to foot 100% of the bill.* To protect from potentially incurring high out-of-pocket costs many Americans opt for a Medicare Advantage plan.

Types of Medicare Advantage Plans

Generally speaking, there are four types of Medicare Advantage plans:

• Health Maintenance Organization (HMO) Plans.. One of the oldest forms of organized health insurance, offered by many employee retirement plans. Members generally pay a fixed monthly cost to a number of hospitals and doctors and receive approved treatments from network doctors.
• Preferred Provider Organization (PPO) Plans.. PPOs are similar to HMOs but typically allow for more flexibility in doctor and treatment choice.
• Private Fee-for-Service (PFFS) Plans.Similar to an HMO but typically includes unlimited hospitalization, prescription drug coverage, and flexibility in doctor and treatment choices.
• Special Needs Plans (SNP).A plan established specifically for severe or disabling, chronic conditions.

Your choice of a Medicare Advantage plan will depend on your personal situation and what you hope to attain with additional insurance. To request more information about Medicare Advantage plans, or to request a quote, click here.

*Source:  “Medicare & You 2011.” www.medicare.gov. N.p., 27 May 2011. Web. 18 Jul 2011. www.medicare.gov.