Medicare Advantage is an alternative way to get your Medicare benefits through a private insurance company

A Medicare Advantage plan (also called Part C) is a type of health insurance sold by private companies — not run by Medicare itself — that covers everything Original Medicare covers, plus usually dental, vision, or hearing. Instead of going to any doctor who accepts Medicare, you pick a plan and use doctors and hospitals in that plan's network. The plan gets a fixed payment from Medicare for each person enrolled, and it decides how much you pay for visits, prescriptions, and other care.

The key difference: with Original Medicare (Part A and Part B), you can see any doctor anywhere in the country who accepts Medicare. With Medicare Advantage, you are locked into a network for most care, but you typically pay less out of pocket — lower premiums, lower deductibles, and often no copay for preventive visits. The trade-off is less freedom to choose your doctor and more rules about which hospitals and specialists you can use.

Key Takeaways

  • Medicare Advantage is sold by private insurance companies and requires you to use doctors and hospitals in the plan's network, unlike Original Medicare which has no network restriction.
  • Every Medicare Advantage plan must cover at least what Original Medicare covers (hospital, doctor visits, and prescription drugs), but can add dental, vision, or hearing benefits.
  • You pay a monthly premium to the insurance company, plus copays or coinsurance when you use care, and there is usually an annual out-of-pocket maximum that Original Medicare does not have.
  • If you travel or move, you may not be able to use your plan outside its service area, and you cannot switch plans mid-year except during the annual enrollment period or if you have a may have access to life event.

What Medicare Advantage must cover versus what it can add

Every Medicare Advantage plan is required by law to cover at least as much as Original Medicare: hospital stays (Part A), doctor visits and outpatient care (Part B), and prescription drugs (Part D). Many plans also include dental cleanings and exams, vision exams and glasses, hearing exams and hearing aids, and transportation to medical appointments — benefits Original Medicare does not pay for at all.

The catch is that these extra benefits vary widely by plan and by region. One plan in your area might cover two dental cleanings a year; another might cover cleanings, fillings, and root canals up to a dollar limit. You have to read the plan's benefit summary to know what is actually covered. Plans also change their benefits and networks every year, so a plan you liked last year may look different this year.

How you pay: premiums, copays, and out-of-pocket limits

With Medicare Advantage, you pay a monthly premium to the insurance company (in addition to your Part B premium to Medicare, which you still owe). You also pay copays or coinsurance when you use care — for example, $25 to see your primary care doctor, or 20% of the cost of a specialist visit. These costs add up until you hit your plan's annual out-of-pocket maximum, after which the plan pays 100% of covered care for the rest of the year.

Original Medicare has no out-of-pocket maximum, which means your costs can keep climbing if you need a lot of care. Medicare Advantage caps your costs, which can save money if you use a lot of health services. However, if you rarely go to the doctor, you might pay more in premiums and copays than you would with Original Medicare plus a separate Medigap policy.

Network restrictions and what happens if you go out of network

Most Medicare Advantage plans are either HMOs (Health Maintenance Organizations) or PPOs (Preferred Provider Organizations). An HMO requires you to use doctors and hospitals in the plan's network and usually requires you to pick a primary care doctor who coordinates your care. A PPO lets you see any doctor in the network without a referral, and sometimes lets you see out-of-network doctors for a higher copay.

If you go to a doctor or hospital outside the plan's network without authorization, you may have to pay the full bill yourself — the plan will not pay anything. The exception is emergency care; all plans must cover emergency room visits even if the hospital is out of network. If you travel frequently or live part of the year in another state, check whether your plan has doctors and hospitals where you spend time, or consider Original Medicare instead.

When you can switch plans or go back to Original Medicare

You can change Medicare Advantage plans or switch to Original Medicare during the Annual Enrollment Period, which runs from October 15 to December 7 each year. Changes take effect January 1. Outside this window, you cannot switch unless you have a may have access to life event — you move out of the plan's service area, you lose Medicaid, you are in a nursing home, or a few other specific situations.

If you decide Medicare Advantage is not for you and want to go back to Original Medicare, you can do so during the Annual Enrollment Period without penalty. However, if you drop the plan and do not enroll in a Medigap policy at the same time, you may pay higher premiums for Medigap later because you will have lost your may provide issue rights. Talk to your plan or call 1-800-MEDICARE before you make the switch.

How Medicare Advantage plans are rated and how to compare them

Medicare publishes a star rating for each plan (1 to 5 stars) based on member satisfaction, quality of care, and customer service. You can see these ratings on Medicare.gov, along with each plan's premiums, copays, deductibles, and which doctors and hospitals are in the network. The ratings change every year, so a plan that was highly rated last year might have dropped this year.

When comparing plans, look at three things: whether your current doctors are in the network, what the total out-of-pocket costs would be for your expected care (not just the premium), and the plan's star rating. A cheap premium means nothing if your doctor is out of network or if the plan has poor customer service ratings. Medicare.gov has a plan comparison tool, and you can also call 1-800-MEDICARE to talk through your options.

Frequently Asked Questions

Do I have to join a Medicare Advantage plan?

No. Medicare Advantage is optional. You can stay on Original Medicare (Part A and Part B) and add a Medigap policy and a separate Part D prescription drug plan if you want. However, if you do not join a Medicare Advantage plan or a Medicare Prescription Drug Plan by the important date, you may pay a penalty for late enrollment.

Can I use my Medicare Advantage plan if I travel out of state?

Most plans cover emergency care anywhere in the country, but routine care is usually only covered in-network within the plan's service area. Some plans (especially PPOs) cover out-of-network care at a higher cost. Check your plan's coverage map or call the plan before you travel to know what is covered where you are going.

What happens to my Medicare Advantage plan if I move?

If you move outside your plan's service area, you can switch to a different plan or go back to Original Medicare without waiting for the Annual Enrollment Period. You have 60 days from the date you move to make the change. Contact your plan or Medicare to report your move and see what options are available in your new location.

Is prescription drug coverage included in Medicare Advantage?

Yes. Every Medicare Advantage plan includes prescription drug coverage (Part D). You do not need to buy a separate Part D plan. The copays and coverage rules vary by plan, so check your plan's formulary (the list of covered drugs) to make sure your medications are covered.

What is the difference between a Medicare Advantage HMO and a PPO?

An HMO requires you to use in-network doctors and usually requires a referral to see a specialist. A PPO lets you see any in-network doctor without a referral and sometimes covers out-of-network care at a higher cost. PPOs usually have higher premiums and copays than HMOs, but more flexibility in choosing doctors.