One of the first things people may want to know when shopping for health insurance coverage the cost of the plan. But what if there were affordable Medicare Advantage plans that offered $0 premiums?1
There were over 3,100 Medicare Advantage plans for sale in the U.S. in 2018, and many of those have $0 premiums.2 Here we’ll take a detailed look at these plans and help you make the most informed decision regarding your Medicare coverage.
How can a Medicare Advantage plan have a $0 premium?
Medicare Advantage plans with $0 premiums may still include some other cost requirements, similar to those that can be found with plans that do have premium costs. These costs may include:
- Deductibles
Medicare Part A, Part B, Part C and Part D plans can each have a deductible, which is the amount you must pay out of pocket before Medicare or your plan pays its share. Deductibles typically apply on an annual basis and reset with each new plan year. (This is not the case with Medicare Part A, however. The Part A deductible must be met during each benefit period, which starts the day you’re admitted for inpatient hospital care and ends when you stopped receiving inpatient care for 60 consecutive days.) - Copayments or coinsurance
$0 premium Medicare Advantage plans may feature certain cost-sharing measures such as copayments (a flat fee) or coinsurance (a percentage of the cost of services or equipment). A copayment or coinsurance is the amount that you must pay for medical services, doctor visits, medical equipment or prescription drugs after your deductible is met.
For example, if you are enrolled in a Medicare Advantage plan with 20 percent coinsurance charges, you will pay 20 percent of the total cost of medical services you receive after you have met your plan’s deductible. Your plan will cover the remaining 80 percent of the costs.
By contrast, a $30 copay requires you to pay $30 for each service you receive after your deductible is met, regardless of the total bill amount for the covered services. - Out-of-pocket maximums
A plan’s out-of-pocket maximum is the total amount you can expect to pay during a plan year. Medicare Advantage plans will pay 100 percent of the remaining costs for covered services for the remainder of the year once this maximum is reached. By law, Medicare Advantage plans had to have an out-of-pocket maximum of no more than $6,700 in 2018.3 - Out-of-network costs
Medicare Advantage plans can be structured in a number of different ways, including Medicare HMO and Medicare PPO plan types, among others. Some of these types of Medicare Advantage plans include a network of preferred health care providers. With some of these plans, it may cost more money to receive approved medical care outside of the plan’s network. In some cases, out-of-network care may not be covered at all. - Part B premium
Anyone who wants to enroll in a Medicare Advantage plan, whether it’s a $0 premium Medicare Advantage plan or not, must remain enrolled in both Part A and Part B of Medicare. Most people do not pay a premium for Part A, but the standard Part B premium for 2019 is $135.50 per year.4 If you are enrolled in a $0 Medicare Advantage plan, you must continue to pay your Medicare Part B premiums (and Part A premiums, if you do not receive premium-free Part A).
How many Medicare Advantage plans have $0 premiums?
From 2015 to 2016, the availability of $0 premium Medicare Advantage plans surged, as more than 80 percent of Medicare Advantage beneficiaries had access to at least one $0 premium plan in 2016. This represented a 78 percent increase from 2015.5
What do $0 premium Medicare Advantage plans cover?
By law, Medicare Advantage plans must provide the same basic coverage as Part A and Part B of Medicare (though you still receive coverage for hospice care through Medicare Part A).
Some Medicare Advantage plans may then offer additional benefits that are unique to each plan. Some popular additional benefits include coverage for prescription drugs, vision, hearing and dental treatment.
Like any Medicare Advantage plan, a $0 premium plan may offer different benefits than other available plans.
Read additional medicare costs guides to learn more about Medicare costs and how they will affect you.
Where can I get a $0 Medicare Advantage plan?
Every state except Alaska has Medicare Advantage plans for sale in 2019, and Wyoming was the only state in 2018 (aside from Alaska) that did not offer any $0 premium plans.6 Not every area within each state will necessarily have a $0 premium plan for sale, as costs and availability vary all across the U.S.
If you’re interested in comparing Medicare Advantage plans where you live, contact a licensed insurance agent at TTY Users: 711 (24 hours a day, 7 days a week) to review available plans and to learn more about what each plan may have to offer.
1 You must continue to pay your Medicare Part B premium. $0 premium plans may not be available in all areas.
2 Centers for Medicare & Medicaid Services. Medicare offers more health coverage choices and decreased premiums in 2018. Retrieved from https://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-releases/2017-Press-releases-items/2017-09-29.html.
3 National Council on Aging. Medicare Advantage: Overview of Coverage and Costs. Retrieved from https://www.ncoa.org/wp-content/uploads/medicare-advantage-coverage-and-costs.pdf.
4 Medicare.gov. Medicare 2019 costs at a glance. Retrieved from https://www.medicare.gov/your-medicare-costs/costs-at-a-glance/costs-at-glance.html
5 Jacobsob, Gretchen. Medicare Advantage 2016 Data Spotlight: Overview of Plan Changes. Dec. 3, 2015. Kaiser Foundation. Retrieved from https://www.kff.org/report-section/medicare-advantage-2016-data-spotlight-overview-of-plan-changes-plan-premiums.
6 Kaiser Foundation. Medicare Advantage Plans. Retrieved from https://www.kff.org/medicare/state-indicator/plans/?currentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D.
