Medicare Advantage Plan Costs Vary by Plan, Location, and Your Health Status

Medicare Advantage plan costs depend on which plan you choose, where you live, and sometimes your health history. Most plans charge a monthly premium — the amount you pay to the insurance company each month — but the premium can be zero dollars. Many plans also charge a copay when you see a doctor or fill a prescription, and some charge a deductible before coverage begins. The total cost you pay in a year depends on how much medical care you actually use.

Your costs come from three places: the monthly premium you pay to the plan, the out-of-pocket costs when you use care (copays, coinsurance, and deductibles), and any costs for services Medicare does not cover. A plan with a zero-dollar premium might have higher copays. A plan with a higher premium might have lower copays. You need to look at the actual plan documents to know what you will pay.

Key Takeaways

  • Monthly premiums for Medicare Advantage plans range from zero dollars to several hundred dollars, depending on the plan and your location.
  • You also pay copays and deductibles when you use care, and these amounts vary widely between plans.
  • Plans with zero-dollar premiums usually charge higher copays for doctor visits and prescriptions.
  • Your total yearly cost depends on how much medical care you use, not just the premium.
  • The plans available to you and their costs change each year, so you should review your options during the annual enrollment period.

How Monthly Premiums Work

The monthly premium is what you pay the insurance company to be enrolled in the plan. This is separate from your Medicare Part B premium, which you pay to Medicare itself. Many Medicare Advantage plans have a zero-dollar premium, meaning you pay nothing monthly to the plan — you only pay Medicare's Part B premium. Other plans charge a premium on top of Part B.

Premiums vary by location. A plan offered in one county might cost $50 per month, while the same plan in a neighboring county might cost $80 per month. Premiums also change from year to year. The plan you had last year might cost more or less this year, or it might not be offered anymore. This is why you need to check your plan's cost every year during the annual enrollment period, which runs from October 15 to December 7.

Copays, Deductibles, and Out-of-Pocket Limits

When you use medical care, you pay a copay — a fixed amount for a specific service. A copay for a doctor visit might be $20, while a copay for a specialist visit might be $50. Prescription drugs have their own copays, which can range from a few dollars for a generic drug to $100 or more for a brand-name drug. These copays are set by the plan and vary widely.

Some plans also have a deductible, which is the amount you must pay out of your own pocket before the plan starts to pay. Not all Medicare Advantage plans charge a deductible, but those that do might have a deductible of $100 to $500 or more. Every plan has an out-of-pocket limit — the maximum amount you will pay in copays and coinsurance in a year. Once you reach this limit, the plan pays 100 percent of covered services for the rest of the year. The out-of-pocket limit changes each year; in 2024 it was $7,550 for in-network care.

Prescription Drug Coverage and Costs

Medicare Advantage plans include prescription drug coverage (Part D), so you do not need a separate drug plan. However, the drugs covered and the copays you pay depend on the specific plan. Each plan has a formulary — a list of covered drugs — and drugs are placed in tiers. A tier 1 drug might have a $5 copay, while a tier 4 drug might have a $100 copay.

If your current medications are not on a plan's formulary, or if they are in a high-cost tier, the plan will cost you more. Before you enroll in a plan, you should check whether your medications are covered and what you will pay. You can use the Medicare Plan Finder tool on Medicare.gov to search by drug name and see which plans cover it and at what cost.

How to Compare Costs Between Plans

The best way to understand what a plan will cost you is to use the Medicare Plan Finder on Medicare.gov. Enter your zip code, your current medications, and your preferred doctors and hospitals. The tool will show you all available plans, their premiums, and your estimated out-of-pocket costs based on your health history.

You can also request a detailed plan document called the Summary of Benefits and Coverage (SBC) from any plan you are considering. This document lists all copays, deductibles, and coverage limits. Many plans also have a customer service number you can call to ask about specific costs — for example, what the copay would be for a particular test or procedure.

When comparing plans, look at the total estimated cost for a year, not just the premium. A plan with a zero-dollar premium might cost you more overall if you use a lot of medical care, because the copays are higher. A plan with a higher premium might cost less overall if the copays are lower and you use care frequently.

Extra Benefits and Their Costs

Many Medicare Advantage plans offer extra benefits that Original Medicare does not cover, such as dental care, vision care, hearing aids, or gym memberships. These benefits can reduce your out-of-pocket costs for those services, but they come with limits. A dental benefit might cover two cleanings per year but not major work like crowns. A vision benefit might cover an eye exam and glasses but not contact lenses.

Some plans charge an additional premium for extra benefits, while others include them in the base premium. If you use dental or vision care regularly, a plan with these benefits might save you money even if the premium is higher. If you do not use these services, you are paying for benefits you will not use.

What Happens If You Switch Plans or Leave Medicare Advantage

If you enroll in a Medicare Advantage plan and later decide it costs too much or does not meet your needs, you can switch to a different plan or return to Original Medicare. You can make changes during the annual enrollment period (October 15 to December 7) or during the Medicare Advantage Open Enrollment Period (January 1 to March 31). If you have a may have access to life event — such as moving, losing employer coverage, or a death in the family — you may be able to make changes outside these windows.

If you switch back to Original Medicare, you will lose the extra benefits your Medicare Advantage plan offered, such as dental or vision coverage. You will also need to enroll in a separate Part D prescription drug plan. If you switch to a different Medicare Advantage plan, your costs and coverage will change when ready.

Frequently Asked Questions

Can I have a zero-dollar premium Medicare Advantage plan?

Yes. Many plans have zero-dollar premiums, meaning you pay nothing monthly to the plan beyond your regular Medicare Part B premium. However, zero-dollar plans usually charge higher copays for doctor visits and prescriptions. You need to compare the total estimated cost, not just the premium.

What is the difference between a copay and coinsurance?

A copay is a fixed amount you pay for a service — for example, $20 for a doctor visit. Coinsurance is a percentage of the cost you pay after you meet your deductible — for example, you pay 20 percent and the plan pays 80 percent. Medicare Advantage plans use copays more often than coinsurance.

Do I pay for preventive care in a Medicare Advantage plan?

No. Medicare Advantage plans must cover all preventive services that Original Medicare covers with no copay or coinsurance. This includes annual wellness visits, cancer screenings, and vaccinations. You only pay copays for other types of care.

What if my doctor is not in the plan's network?

Most Medicare Advantage plans are HMOs or PPOs that require you to use in-network doctors. If you see an out-of-network doctor, you will pay a higher copay or coinsurance, or the plan might not cover the visit at all. Before you enroll, check whether your current doctors are in the plan's network.

Can my Medicare Advantage plan premium increase during the year?

No. Once you enroll in a plan, the premium stays the same for that calendar year. However, the premium can change the following year. You will receive a notice in the fall showing your plan's new premium for the next year, and you can switch plans if the increase is too high.