How Medicare Advantage works
- To join, you need Part A and Part B, and you must live in the plan's service area.
- Plans must cover all medically necessary services that Original Medicare covers. Most also offer extra benefits Original Medicare doesn't, like vision, hearing or dental, and those benefits vary from plan to plan.
- You still pay your Part B premium.
Networks: HMO and PPO plans
In many cases, a Medicare Advantage plan asks you to use its network of doctors, hospitals and other providers. Here is how HMO and PPO plans generally work:
- HMO (Health Maintenance Organization): You generally get your care from the plan's network. The exceptions are emergency care, out-of-area urgent care and temporary out-of-area dialysis. Most HMOs ask you to choose a primary care doctor, and you usually need a referral to see a specialist. If you get care outside the network, you may have to pay the full cost.
- PPO (Preferred Provider Organization): You pay less when you use the plan's network. You can generally see out-of-network providers for covered services, but you'll usually pay more. You don't need to choose a primary care doctor or get referrals.
Some plans also need to approve certain services ahead of time, which is called prior authorization. Because networks can change, we check your doctors and hospitals against each plan's network before you choose.
A yearly limit on out-of-pocket costs
Original Medicare has no yearly limit on what you pay out of pocket, unless you add coverage like a Medigap policy. Medicare Advantage plans do have one. Each plan has a yearly limit on what you pay for covered Part A and Part B services. Once you reach it, the plan pays for those covered services for the rest of the year.
The limit can change from year to year. Prescription costs are counted separately, under Medicare drug coverage's own yearly cap.
Drug coverage is usually included
Most Medicare Advantage plans include Part D drug coverage, so you don't need a separate drug plan. If you choose an HMO or PPO that doesn't include drug coverage, you can't add a separate Part D plan. Each plan has its own drug list and pharmacies, so we check your prescriptions plan by plan.
When you can join or switch
- Annual Enrollment Period, October 15 to December 7. Medicare.gov calls this Open Enrollment. Anyone with Medicare can join, switch or drop a Medicare Advantage or Part D plan, or move between Original Medicare and Medicare Advantage. Changes start January 1.
- Medicare Advantage Open Enrollment Period, January 1 to March 31. If you're already in a Medicare Advantage plan, you can make one change: switch to another Medicare Advantage plan, or go back to Original Medicare and join a separate drug plan. You can't use this period to move from Original Medicare into Medicare Advantage.
If you joined a Medicare Advantage plan when you were first eligible for Medicare, you can also make a change within your first three months of coverage.
Why plans change every year, and why a yearly review matters
Medicare Advantage plans can change their costs, benefits, provider networks and service areas each year. Every fall, usually in September, your plan sends an Annual Notice of Change listing what will be different in January. Your own needs change too: a new doctor, a new prescription, a new diagnosis.
That's why we review your plan with you every fall and tell you if anything needs to change.