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Identifying the Medicare Advantage plans that meet your needs

Medicare Advantage plans are usually the lowest-cost option for people who don’t have employer supplemental coverage. In 2013 more than one-half of the people enrolled in Advantage plans have no premiums for their medical and drug coverage. Their only costs will be for co-payments, co-insurance and in some cases deductibles. Also, preventive tests and screenings are covered 100% by Medicare. If someone is in good health, uses relatively few medical services and does not take expensive drugs, his or her costs should be low.

When someone enrolls in an Advantage plan, the plan replaces Medicare’s coverage for as long as he or she is enrolled in that plan. Medicare pays Advantage plans a certain amount for each enrollee, and the rules require that the plans cover the same benefits that traditional Medicare does. But plans can have different cost-sharing than Medicare’s, as long as their overall benefits are as good. In addition, some plans cover services such as routine dental and vision care that Medicare does not cover.

More than one-half of Advantage plans are HMO’s, where the coverage is for services provided by the plan’s networks. Before seeing specialists, patients usually must get referrals from their primary care physicians (emergencies are exceptions). Other types of Advantage plans include Preferred Provider Organizations (PPO’s), Private Fee-for-Service (PFFS) plans, Special Needs Plans, and Medicare cost plans.

Advantage chart

Most Advantage plans include prescription drug coverage. When people enroll in Advantage plans that include drug coverage, they need to make sure that the plans do not have high costs for the prescriptions they take.

Before you enroll in an Advantage plan, you should know the answers to the following questions:

  • are your doctors in the plan’s network?
  • does the plan have an adequate provider network?
  • does the plan have low costs for the prescription drugs that you take?
  • does the plan have a low out-of-pocket limit?
  • does the plan have good quality ratings by Medicare?

Using Medicare's Plan Finder to Compare Advantage Plans

This file has step-by-step instructions for using the Medicare web site to find the Advantage plans that are available in your zip code. If you want to see Advantage plans’ costs for the prescription drugs you take, do not use these instructions. Instead, follow the instructions under “Using Medicare’s Prescription Drug Plan Finder” on the Part D Plans web page.

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Managing Medicare’s Costs

  • Using your computer to find the right Medicare Advantage plan

    Sometime later this year, Medicare Advantage plans will pass employer retiree plans as the most widely held type of Medicare insurance. Currently there are 20 million people in Advantage plans, more than twice the number ten years ago.

    While total Medicare enrollment has grown at slightly more than 3% a year during the last decade, Advantage plan enrollment has increased twice as fast.

    To keep pace with the influx of new enrollees, insurance companies have been rolling out additional Advantage plans. There are 283 more this year than last year, or a total of 2,317 plans, according to a report by the Kaiser Family Foundation.

    That’s the most since 2009, when generous government subsidies encouraged insurers to flood the market with plans.

    This year’s expansion has a potential upside. As the newer Advantage plans vie for market share, they need to offer attractive benefit packages. And that might put pressure on older plans to follow suit.

    The downside is that even before this year’s additions, in most parts of the country there were already too many Advantage plans. Retirees often complain in surveys that they are overwhelmed by having so many choices. This year, for instance, the average Medicare beneficiary can choose among 21 Advantage plans, according to Kaiser Family Foundation data.

    How do you sort through so many plans to identify the one that’s best for you? If you live in an urban area, your chances of finding an excellent plan are good. But if you live in the country, that may not be the case. This year there are 149 counties that do not have any Advantage plans and another 45 counties with only one plan. And more than one-fourth of U. S. counties have five or fewer plans.

    Even if you live in a remote outpost where there’s only one Advantage plan, you need to do some homework to avoid unpleasant surprises later. If you are computer savvy, you can easily find out quite a bit about a plan online. Or if you don’t want to do the research yourself, you can contact your nearest Medicare counseling agency for assistance.

    To do your own research, you’ll use the Medicare web site’s Plan Finder. There you can rank your area’s Advantage plans in various ways – by monthly premiums, costs for the prescription drugs you take, quality ratings, and so on. And by clicking on a plan’s name, you can see its benefits in greater detail. Here are the steps to follow:

    First, rank the plans by their costs for the Rx drugs you take

    Using Medicare’s Plan Finder and these step-by-step instructions, enter the names, dosages, and monthly quantities of the drugs that you take. If you do not take any prescription drugs, skip the drug entry and go directly to a list of the Advantage plans in your area. Then you can begin the sorting process.

    Let’s say you live in Atlanta, Georgia, and do not take any prescription drugs. When you sort the list of the 21 Advantage plans in the Atlanta area by their drug premiums, you see that 8 of them have annual premiums exceeding $400. That is too much to pay if you do not take any Rx drugs, and so you disregard these 8 plans and concentrate on the remaining 13.

    Within a couple of minutes, you can probably trim the remaining list down to 2 or 3 plans based on what you want in a plan. Possibly one of your doctors told you she is not in any Advantage plan networks. That leaves as your only choice an Advantage PPO plan. And among the 13 remaining Atlanta-area Advantage plans on your list, only two are PPO’s.

    Or maybe you want to consider only the plans that have at least a four-star quality rating from Medicare. In that case, only 4 of the 13 plans meet that standard. Perhaps you want a plan that has an out-of-pocket under $5,000, which will eliminate all but 3 plans.

    Examining the networks

    After you’ve weeded out most of the plans, the next step is to find out if your doctors are in the networks of the plans that are still on your list. Because the online provider directories for Advantage plans are often out of date, the most accurate way is to call your doctors’ offices. And if your doctors are in the network of only one of your finalists, it is likely to be your best option.

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