Medicare Advantage (Part C) plans are offered through private companies as an alternative to Original Medicare. Plans include hospital and medical coverage and may offer additional benefits.
Various Medicare Advantage plan options exist. The cost depends on the plan and other factors.
Many Medicare Advantage plans include prescription drug (Part D) plans, as well as the benefits of Part A (hospital insurance) and Part B (medical insurance). They may also offer additional benefits, such as dental, hearing, and vision services.
Glossary of Medicare terms
We may use a few terms in this piece that can be helpful to understand when selecting the best insurance plan:
- Deductible: This is an annual amount that a person must spend out of pocket within a certain time period before an insurer starts to fund their treatments.
- Coinsurance: This is a percentage of a treatment cost that a person will need to self-fund. For Medicare Part B, this comes to 20%.
- Copayment: This is a fixed dollar amount that an insured person pays when receiving certain treatments. For Medicare, this usually applies to prescription drugs.
Medicare Advantage (Part C) plans are health plans that private companies offer. The companies contract with Medicare to provide Medicare Part A and Part B benefits. Many plans also offer prescription drug coverage under Part D.
A person can enroll in or switch to a Medicare Advantage plan if they have Original Medicare (parts A and B), and if the plan they want is offered in their area. A person enrolled in an Advantage plan may need to pay the plan premium, plus copays and deductibles.
Medicare Advantage plans include:
- Health Maintenance Organization (HMO)
- Preferred Provider Organization (PPO)
- Private Fee-for-Service (PFFS)
- Special Needs Plans (SNPs)
Here is a look at each of these plans:
| Advantage plan | Description |
|---|---|
| HMO | • Individuals must typically use in-network professionals. • Exceptions to in-network use include emergency services and out-of-area urgent care. • Some out-of-network care may be available at a higher cost. • Out-of-network services may require prior approval. |
| PPO | • Plans have a list of in-network doctors and hospitals. • Costs are lower when a person uses in-network professionals and facilities. • Individuals can typically use out-of-network doctors with a higher cost. |
| PFFS | • Individuals can go to any Medicare-approved professional or facility. • The plan determines how much it pays to the doctor or facility and how much the individual pays at the time of service. |
| SNP | • Plans provide services and benefits for individuals with certain healthcare needs or specific conditions, as well as those who also have Medicaid. • Plans include care coordination services. • Plans offer tailored options for drug coverage, benefits, and healthcare professional choices. |
Other plans are HMO Point of Service (HMO-POS) plans and Medicare savings account (MSA) plans. However, these are less common types of plans.
If a plan stops participating in Medicare, the person enrolled in the plan can choose to go back to Original Medicare or join another Medicare Advantage plan.
As an alternative to Original Medicare, Advantage plans provide the same coverage as Medicare parts A and B, including emergency and urgent care.
Many plans offer additional coverage for:
- eye care
- dental care
- prescription drug coverage
- hearing aids
- fitness membership
- wellness services
If a person is not sure whether a service will be covered, they should check with their Medicare Advantage provider before enrolling.
Learn more about Medicare Advantage coverage.
Advantage premiums vary among plans, and some plans may not charge premiums. According to the nonprofit KFF, average Advantage premiums in 2024 are around $18.50 per month.
A person may also have to pay copays and deductibles, which also vary among plans. Copays are typically a flat fee set by the plan provider.
Out-of-pocket costs may be lower than with Original Medicare and have a yearly limit. The maximum out-of-pocket cost for 2024 is $8,850. Once a person pays this amount, they will no longer have to pay for their services out-of-pocket.
This online tool can help a person find a plan and compare costs.
An individual may wish to consider various factors when choosing a Medicare Advantage plan, as explained in the following table:
| Advantage plan | What to consider |
|---|---|
| HMO | • Most HMO plans offer prescription drug coverage. • Plans charge a monthly premium in addition to the monthly Part B premium. • Individuals typically need to receive treatment from in-network doctors. • Individuals generally require a referral to see a specialist. • HMO plans cannot charge more than Original Medicare for services, such as chemotherapy, dialysis, and skilled nursing facility care. |
| PPO | • Most PPO plans include prescription drug coverage. • Individuals can use out-of-network healthcare professionals but may have to pay more. • Individuals do not require a referral to see a specialist. • If an individual uses a “preferred” doctor, they can save on costs. • The plan cannot charge more than Original Medicare for services, such as chemotherapy, dialysis, and skilled nursing facilities. • Plans usually charge a monthly premium in addition to the Part B monthly premium. |
| PFFS | • The plan determines how much it pays to the doctor or facility and how much the individual will need to pay at the time of service. • Not all PFFS plans include prescription drug coverage. If drug coverage is not provided, an individual will need to consider a Part D plan. • Individuals can use any Medicare-approved healthcare professional or facility. • Individuals do not need a referral to see a specialist. • Individuals must show their membership ID care each time they see a doctor. |
| SNP | • It provides coverage only for individuals with certain healthcare needs or specific conditions, or those who already have Medicaid. • All SNPs provide prescription drug coverage. • Some plans require individuals to see in-network healthcare professionals. • Referrals may be required for certain services but not others. • Individuals can keep an SNP for as long as they meet the conditions of the plan. |
Read about the pros and cons of Medicare Advantage.
An individual can find out more about Advantage plans and the enrollment process in several ways, including:
- calling 800-633-4227 (800-MEDICARE) to find out which plans are available in their area
- asking for a paper enrollment form from the plan and returning the completed plan to the company
- checking this list of things to remember about Advantage plans
- using the Medicare plan finder tool to find a plan that suits their needs
A person with end stage renal disease (ESRD) may enroll in an Advantage plan only if it is an SNP that accepts people with the condition.
There are three set time periods when a person can join a Medicare Advantage plan, as well as change or drop their current plan.
Initial enrollment period (IEP)
A person can join a Medicare Advantage plan when they first get Medicare. The IEP centers on the day a person turns 65 years old:
- It begins 3 months before the month a person turns 65.
- It includes the month a person turns 65.
- It ends 3 months after the month a person turns 65.
Open enrollment period (OEP)
During the OEP from October 15 to December 7, a person can switch Advantage plans or choose to drop a plan. They can also make changes to a Part D (prescription drug) plan.
Medicare Advantage open enrollment
This period runs from January 1 to March 31. It is a period when people who already have Medicare Advantage can switch to another plan or drop their plan and return to Original Medicare.
Read a comparison of Original Medicare and Medicare Advantage.
Medicare resources
For more resources to help guide you through the complex world of medical insurance, visit our Medicare hub.
Private companies offer Medicare Advantage (Part C) plans. This is an alternative to Original Medicare (parts A and B), and it may offer additional benefits.
In addition to plan premiums, a person will have to cover copays and deductibles. Costs may vary among plans.
A person can join or change Advantage plans during various enrollment periods.