As we approach Medicare’s Annual Election Period for 2021, you will undoubtedly receive a truckload of brochures offering the BEST Medicare Advantage plan. You can toss them! (This post has been updated for the upcoming 2021 Medicare annual election period).
So what is the best Medicare Advantage plan?
The best Medicare Advantage plan is generally the one that includes your doctors in the plan’s network and your medications on the plan’s formulary. You can find Advantage plans from major carriers like United Healthcare, Aetna, Cigna, Anthem/Blue Cross Blue Shield, Humana, and quite a few other carriers.
This means there is no way for anyone to know the best Medicare Advantage plan for themselves without doing some research first.
If you are new to Medicare Advantage, we’ve got some great tips for you here on how to do that, and we’ll discuss some of the carriers that offer these plans, too.
If you are currently on an Advantage plan and thinking about changing to a different plan for 2021, then you will certainly have lots of great options. Advantage plans are more popular than ever, and we’ll explain why.
Understanding Medicare Advantage Plans
It’s important for you to know that Medicare doesn’t allow any Medicare Advantage plan to call itself the best Medicare Advantage plans. That’s because there are different networks, benefit, features costs, and lists of covered medications. What is best for you is likely different than what is best for your neighbor.
If you like your current plan and don’t mind its upcoming changes, you are set and don’t need to do anything. If not, we suggest shopping around to see if you can find something that will better fit your needs and income.
Different than Medigap
You may have heard Medicare Advantage plans referred to as Medicare replacement plans. While these plans don’t permanently replace your Medicare benefits, it’s accurate in the sense that members of Advantage plans get their benefits from a private insurance company instead of Original Medicare.
When you enroll, it’s typically for the rest of the calendar year. You may not be able to disenroll mid-year unless you have a special circumstance.
Lower Premiums, But Networks
These plans often have lower premiums than Medigap plans. There can even be $0 premiums on some plans in specific areas. In exchange for the lower premiums, you have a different set of rules to abide by than those on Original Medicare.
For example, your plan will have a network of providers. The two most common network types are HMO and PPO networks, and we’ll discuss these below.
Since these insurance companies are private, they can offer extra benefits such as dental, vision or hearing. Some even offer free gym memberships.
These are benefits you will not find in Original Medicare or a Medigap plan. These ancillary benefits are one reason why some individuals feel like Medicare Advantage is the best fit for them.
What to Look for When Comparing Medicare Advantage Plans
The advantage to Advantage Plans (yes, the pun was intended there) for most people are the lower premiums. However, some beneficiaries may choose a plan because of its network or drug formulary or its extra benefits. The plan that’s best for your neighbor isn’t necessarily the best for you.
We’ve made a list of the main questions to consider while comparing plans.
Are your doctors in the plan’s network?
When my team researches MA options for our clients, the first thing we do is check to see if the plan’s network includes the client’s important doctors. We check the plan’s online directory and we confirm with the doctor’s office as well.
Each Medicare Advantage plan will have a network of providers in the location where the plan is based. Most Medicare Advantage plans have HMO or PPO networks. Medicare HMO plans are the most prevalent type of MA and for them to pay your claims, you usually must be seen by a provider in that network.
Medicare PPO plans will allow you to see doctors outside of the network, but your out-of-pocket expenses will be substantially higher. The out of network doctor must also be willing to bill the plan.
What will your out-of-pocket costs be?
It is important to know what your annual out-of-pocket costs will be. Every plan is different, but none will exceed $6,700 (in-network) in out-of-pocket costs. If the maximum out-of-pocket cost on a plan you are considering is more than you think you can afford, you may want to consider a plan that offers a lower annual out-of-pocket.
The best Medicare Advantage plan for you should definitely offer cost-sharing that you can afford in the event of a medical emergency.
Are your drugs on the formulary?
Many Medicare Advantage plans include built-in Part D coverage. This can be convenient as you will not need additional drug coverage with a plan like this. It’s critical to check the drug formulary of any plan you are considering to make sure it includes your important medications.
All too often we see beneficiaries spend time making sure their doctors are in-network but then they overlook checking to see if the predetermined drug plan included their medications.
Advantage plans have lock-in periods, and you never want to find out in January that the plan that you thought was the best Medicare Advantage plan for you doesn’t cover a $400 brand name medication that you need.
In this situation, you could be stuck footing the bill for expensive medications for an entire year before you can change. So, always review the formulary carefully.
What is the Medicare Advantage Plan’s Star Rating?
Medicare has a five-star rating system in which it rates Medicare Advantage plans. Why are Medicare star ratings important? Well, the rating evaluates things such as customer satisfaction and quality of care from plan to plan.
Most people tend to select a plan with 3.5 stars or more, and this is probably wise. There’s very likely a good reason that the plan got the star ratings that it did. It can provide you with peace of mind to choose a plan that many other beneficiaries have expressed satisfaction in.
It is also good to note that plans with the top ratings of four or five stars get additional funding from the government to spend on your medical benefits. These bonuses go toward providing you with extra benefits, and this is a win-win for everyone.
Does the Medicare Advantage plan offer extra benefits?
As we mentioned earlier, some Advantage plans come with added dental and vision coverage or even a gym membership benefit. We often get calls from beneficiaries that only want a plan if it offers a gym membership such as Silver Sneakers.
Though these extras are an excellent offering (and we love hitting the gym too), you should always make your decision based upon your medical needs first and foremost. Should the plan that fits your medical needs also offer added benefits like Silver Sneakers, then it may be a great fit for you.
Common Questions about the Best Medicare Advantage Plans
Many of the major carriers that offer Medicare supplement plans also offer Medicare Advantage plans. These include name-brand carriers like United Healthcare, Aetna, Cigna, Blue Cross Blue Shield, and Humana.
However, plan offerings vary by county. While a carrier may offer an HMO in one county, it may not offer that same HMO in the next county over. It depends on the number of providers available to make a network in each area.
There are also quite a few local regional carriers that offer plans in only a few areas. For example, in the Dallas/Fort Worth area there are Advantage plans offered by Care ‘n’ Care that have networks in just a few local counties. It’s common to find other local plans like these in other areas too.
About one-third of all Medicare beneficiaries choose a Medicare Advantage plan for their coverage. Many of them believe that the lower premiums make them a good deal. Just keep in mind that you have to pay copays and coinsurance whenever you use healthcare services.
This means that in a year of high medical usage, you’ll spend more on your Medicare Advantage plan than in years where you have low medical usage.
Medicare Advantage plans must cover all the same services that are offered under Medicare Part A and B. It’s just that your cost-sharing is set by the plan instead of Original Medicare. There is no one coverage that Medicare considers to be better. The reason there are choices is so that you can find a plan that feels suitable for your personal needs and budget.
For more on Medicare Advantage plans vs Medigap plans, visit this post here on our site where you can also get our free guide on how these two types of coverage differ.
Yes. You must be enrolled in both Medicare Part A and Part B to be eligible to enroll in a Medicare Advantage plan. Enrolling in Medicare Advantage does NOT get you out of paying for Part B.
On some plans, yes. The insurance carrier offering the plan gets to decide what deductibles it will apply to your benefits. When your Boomer Benefits agent finds a suitable plan for you, we will go over the Summary of Benefits in detail and explain exactly what deductibles you must satisfy in the plan.
Some plans may have no deductible for Part A or B but do have a deductible for Part D. The Part D deductible cannot be higher than Medicare’s standard guideline for that year. Some plans charge the full deductible while other plans require a partial deductible. Some plans may waive the deductible altogether.
It is also common to see a deductible that applies to out-of-network benefits on Medicare Advantage PPO plans. Treating outside of the plan’s network generally costs more than if you were to use the in-network providers.
Monthly premiums vary widely around the country. You can find plans as low as $0/month in many urban areas. This means you pay nothing more than what you pay for Part B.
You can also find plans that cost well over $300/month. On average though, most Medicare Advantage plans have lower premiums than Medigap plans.
Getting Enrolled or Changing Medicare Advantage Plans
If you are turning 65 and plan to enroll in a Medicare Advantage plan, you can do so in your Initial Enrollment Period (IEP). You will have three months before your birthday, your birthday month, and three months after to select your plan.
Alternatively, if you are thinking about changing plans in 2021, the Annual Election Period (AEP) is the most common time to change your Medicare Advantage plan. This period runs from October 15th through December 7th each fall. Changes made to your plan will take effect January 1 of the following year.
In contrast, if you decide to leave your Medicare Advantage plan and return to Original Medicare, you must notify your Medicare Advantage plan carrier.
If not, Medicare will continue to show that you are enrolled in the Advantage plan instead of Medicare. This situation can be a billing nightmare. We see it often among people who enrolled on their own without the help of an agent.
It is always best to enroll in Medicare Advantage through an insurance agency like Boomer Benefits who can fully explain how the plan works. Enrolling without an agent means you are on your own if problems occur on the back end of your policy. Who wouldn’t want a free Medicare advocate?
One Last Thought
So by now, you have figured out that the best Medicare Advantage plan varies for different people. There are many factors to consider carefully so give yourself some time to do the proper research. I also have a tip for you no matter which Medicare Advantage plan you decide is best.
My team and I have worked with thousands of people over the years, and this is my best tip when it comes to Medicare Advantage plans: plan for a rainy day.
Medicare Advantage plans can be costly if you end up treating for a serious health condition like cancer. We have seen people that were perfectly healthy that later required chemo.
This often results in costly out-of-pocket expenses on top of their monthly premiums. As we mentioned before, your exposure can be as high as $6,700 per year out of your own pocket on some plans.
If you have funds set aside for this, then Medicare Advantage may work well for you. If you don’t, then investing in a fuller coverage Medigap plan is something you might consider. In the end, it’s your choice and only YOU know what your risk tolerance is.
Get Help Finding the Best Medicare Advantage Plan for YOU
Every situation is different. My team can offer you unbiased information to help you decide. Our service is free.
Contact Boomer Benefits for help today at (855) 732-9055. We work with many plans in 48 different states, so we can pull a list of Medicare Advantage plans in your area and help guide you through your options.