Why Did the Government Create Medicare Advantage and Who Can Get It?
Fall is a season of change—and not just when it comes to the weather! From October 15 through December 7, folks on Medicare can make changes to their Medicare coverage, including switching from Original Medicare to Medicare Advantage or changing to a new Medicare Advantage plan.
Are you unfamiliar with Medicare Advantage and wondering what it is and who can get it? We’ve got your back! To help you understand more about this coverage, let’s start with the basics.
Original Medicare vs Medicare Advantage. What’s the difference?
When you sign up for Medicare, you have options to get your coverage:
- Original Medicare is managed by the federal government and has two parts: Part A (hospital insurance) and Part B (medical insurance).
- Medicare Advantage (Part C) is a type of Medicare health plan offered by private insurance companies that contracts with Medicare. These plans offer the same coverage as Part A, Part B and usually include extra benefits such as prescription drug coverage.
Why did the government create Medicare Advantage?
Original Medicare was founded in 1965, but Medicare Advantage came about a bit later in 1997 when President Bill Clinton signed Medicare+Choice into law; the name changed to Medicare Advantage in 2003. The government had two main goals when it created Medicare Advantage:1
- To give beneficiaries a choice of health insurance plans beyond the Original Medicare program
- To reduce government expenditures by transferring costs to the private insurance companies
Medicare Advantage gives people with Medicare more options when it comes to health insurance. Your health care and budgetary needs will determine whether Original Medicare or Medicare Advantage is right for you.
Who can sign up for Medicare Advantage?
Good news—nearly everyone on Original Medicare can sign up for Medicare Advantage! You can enroll in a Medicare Advantage plan if all of these apply:2
- You’re a U.S. citizen or lawfully present in the U.S.
- You have Medicare Part A and Part B.
- You live in the service area of the plan you want to join (more on this later!).
What else do I need to know about Medicare Advantage?
If you’re considering enrolling in a Medicare Advantage plan, here are a few more things to consider:
- Provider networks: Most Medicare Advantage plans have provider networks, which means you have to use doctors and hospitals included in the network or you may incur additional out-of-pocket expenses. This is different than Original Medicare, in which you can use any doctor or hospital that accepts Medicare. If you have a certain doctor, hospital or specialist that you need to use, it’s important for you to find a Medicare Advantage plan that works with your preferred providers.
- Service areas: Medicare Advantage plans have service areas which are geographic areas where plans provide medical services to members. Original Medicare doesn’t have service areas.
- Costs: With Medicare Advantage, out-of-pocket costs vary plan-to-plan. When researching options, be sure to look out for premium, deductible, copay, coinsurance and out-of-pocket limit amounts.
- Additional coverage: Unlike Original Medicare, Medicare Advantage plans often include extra benefits for services like prescription drugs (MA-PD), vision, hearing, dental or more. When researching insurance carriers, be sure to find out if there are any restrictions you should be aware of when accessing these benefits.
We hope this information helps you better understand your options when it comes to Original Medicare and Medicare Advantage!
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1National Library of Medicine, An Economic History of Medicare Part C, https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3117270/, accessed July 2022.
2U.S. Centers for Medicare and Medicaid Services, Who can join a Medicare Advantage plan?, https://www.medicare.gov/types-of-medicare-health-plans/medicare-advantage-plans/who-can-join-a-medicare-advantage-plan, accessed July 2022.
myHealthPolicy.com and K.F. Agency, Inc. are not connected with or endorsed by the United States government or the federal Medicare program.
We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options. Not all plans offer all of these benefits. Availability of benefits and plans varies by carrier and location. Deductibles, copays, coinsurance, limitations, and exclusions may apply.
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