Medicare was signed into law in 1965 after a national study showed that 56% of Americans over the age of 65 were not covered by health insurance. Medicare Advantage, also known as Part C and originally called Medicare+Choice, was created in 1997 as an alternative to Original Medicare.
As of 2021, nearly 63.8 million Americans had coverage through Medicare, and nearly 42% of those Medicare recipeints are enrolled in a Medicare Advantage plan. If current trends continue, it is estimated that over 50% of recipients will be enrolled in an Advantage plan by 2030.
What the pros and cons of each?
Original Medicare
Cons:
Pros:
Prescription drugs are not covered - unless a separate drug plan is purchased
Unless a Medicare Supplement is purchased, there are deductibles, copays, and coinsurance for things like doctors visits, ER visits, ambulance costs, hospital stays, and certain medical supplies.
Can choice any doctor or hospital that accepts Medicare
Don’t need a referral to see a specialist
Can go to any emergency room
If you’re super-healthy, Original Medicare costs nothing except for the Part B premium and the optional Part D premium
Medicare Advantage
Cons:
Pros:
Must use network providers
Referrals from primary care physician generally needed before seeing a specialist
Geographic limitations to coverage due to use of networks
Annual cap on out-of-pocket costs can be high - up to $11,300 in 2021
May not cost more - many plans are zero premium
Many plans include a prescription drug plan
Many more benefits available at no extra charge, such as eye exams and glasses, hearing aids, dental benefits, OTC drug benefits, transportation, gym membership
A focus on wellness
What’s the best choice for you?
The best choice for each beneficiary comes down to a variety of factors, such as general health condition and needs, if you will use the extra benefits offered by an Advantage plan, if you travel frequently outside of your network area, if you prefer managed care of an Advantage or would rather have flexibility of doctors, and if you are diagnosed with a chronic condition and want the predictability of costs that Original Medicare with a Supplment offers.