Pros and Cons of Medicare Advantage
By Amerus Financial • September 25, 2020
Medicare Advantage plans have become a popular alternative to traditional Medicare over the past decade. Millions of seniors have opted for the enhanced benefits these plans offer compared to the more limited coverage of Original Medicare. But are Medicare Advantage plans the right choice for everyone?
In this article, we’ll explore both the advantages and disadvantages of Medicare Advantage plans so you can make an informed decision—especially important if you are turning 65 and enrolling for the first time.
Let’s begin with the advantages of Medicare Advantage.
1. Medicare Advantage Cost
With Original Medicare, beneficiaries face a hospital deductible under Part A and an uncapped 20% coinsurance under Part B. This often leads people to purchase a Medicare Supplement plan, which can cost over $100 per month, plus a separate Part D prescription plan and the standard Part B premium.
Medicare Advantage plans are appealing because many offer very low—or even zero—monthly premiums. In some regions, plans even refund part or all of your Part B premium, making them especially attractive for seniors on fixed incomes.
2. Additional Medical Care Benefits
Medicare Advantage plans often include benefits not covered by Original Medicare, such as:
- Built-in prescription drug coverage (MAPD plans)
- Dental and vision coverage
- Transportation to and from medical appointments
- Over-the-counter drug allowances
- Coverage for services like acupuncture
3. Maximum Out-of-Pocket Protection
One major advantage of Medicare Advantage is the annual maximum out-of-pocket limit. Once this limit is reached—often starting around $3,400 depending on the plan—covered medical costs are paid in full for the rest of the year.
Disadvantages of Medicare Advantage
While Medicare Advantage offers many benefits, there are drawbacks that may make it less suitable for certain individuals.
4. Limited Networks of Doctors
Most Medicare Advantage plans require you to use a specific provider network. HMO plans, in particular, limit coverage to in-network doctors except in emergencies. This can be challenging for those in rural areas or those who want broader provider access.
5. Referrals and Prior Authorizations
Many Medicare Advantage plans require referrals and prior authorization for non-emergency services such as MRIs, outpatient procedures, and specialist visits. While usually manageable, this process can delay care.
6. Limited Service Areas
Medicare Advantage plans typically operate within regional service areas. To stay enrolled, you must live within the plan’s coverage area for at least six months each year.
The bottom line is that Medicare Advantage plans can be an excellent choice for some individuals but not ideal for others. Understanding plan rules and provider networks is key.
Speak with one of our trained specialists for personalized guidance. Call 1-888-441-7891.
This Medicare resource was provided by Amerus Insurance Group, a nationwide independent agency that helps seniors confidently compare plan options, control out-of-pocket costs, and enroll with the right coverage for their doctors, prescriptions, and lifestyle. Whether you’re new to Medicare or reviewing your current plan, speak with an Amerus advisor for a free, personalized consultation.
