How Medicare Advantage differs from Original Medicare

Medicare Advantage plans (also called Part C) bundle your hospital and medical coverage into one plan run by a private insurance company, rather than having Medicare pay your bills directly. The main advantage is that most plans include prescription drug coverage, dental, vision, and hearing benefits — things Original Medicare does not cover at all. You also typically pay a lower monthly premium than you would for Original Medicare plus a separate Part D drug plan.

The trade-off is that Medicare Advantage plans use networks. You must see doctors and hospitals within that network (except in emergencies), and you usually need a referral from your primary care doctor before seeing a specialist. Original Medicare has no network — you can see any doctor who accepts Medicare anywhere in the country.

Key Takeaways

  • Medicare Advantage plans include prescription drug, dental, vision, and hearing coverage in one monthly payment, whereas Original Medicare covers none of these.
  • Most Medicare Advantage plans have a lower or zero monthly premium than Original Medicare plus a separate drug plan, though you may pay more at the doctor's office.
  • You must use doctors and hospitals in the plan's network, and referrals are usually required to see specialists.
  • Out-of-pocket costs are capped each year with Medicare Advantage, so your total spending cannot exceed a set limit even if you need extensive care.
  • Medicare Advantage plans change their benefits and networks every year, so you must review your options during the annual enrollment period.

Lower or zero monthly premiums

Many Medicare Advantage plans charge no monthly premium beyond the Part B premium you already pay to Medicare. Others charge between $0 and $200 per month, depending on the plan and your location. This is often less than the combined cost of Original Medicare (which requires a Part B premium) plus a standalone Part D prescription drug plan plus a Medigap supplemental policy.

However, a lower premium does not mean lower total costs. Medicare Advantage plans typically charge copays or coinsurance when you visit the doctor, go to the hospital, or fill a prescription. Original Medicare charges a deductible and then covers 80 percent of approved services, so your out-of-pocket cost depends on how much care you use.

Prescription drugs, dental, vision, and hearing included

Original Medicare does not pay for prescription drugs, dental work, vision exams, eyeglasses, or hearing aids. If you choose Original Medicare, you must buy a separate Part D plan for drugs and pay out of pocket for dental, vision, and hearing — or go without.

Most Medicare Advantage plans bundle these benefits in. You may pay a copay for a dental cleaning or a vision exam, but the plan covers the service. Some plans offer a dental benefit that covers cleanings and basic fillings; others cover major work like crowns or root canals. Vision benefits typically include an eye exam and a discount on glasses or contacts. Hearing benefits usually cover a hearing test and may include a discount on hearing aids, though coverage varies widely by plan.

If you take multiple prescription medications, the drug coverage in a Medicare Advantage plan can save you hundreds of dollars per year compared to buying a standalone Part D plan.

Annual out-of-pocket spending cap

Medicare Advantage plans have a maximum out-of-pocket limit — a dollar amount set by Medicare each year. Once you reach that limit, the plan pays 100 percent of your covered services for the rest of the year. In 2024, this limit varies by plan but is typically between $6,700 and $10,000 for in-network care.

Original Medicare has no out-of-pocket cap. If you need extensive hospital care or ongoing specialist visits, your costs can continue to climb indefinitely. This is why many people on Original Medicare buy a Medigap supplemental policy — to protect themselves from catastrophic costs. With Medicare Advantage, that protection is built in.

Coordinated care through a primary doctor

Most Medicare Advantage plans require you to choose a primary care doctor who coordinates your care. Before you see a specialist, you ask your primary doctor for a referral. This structure can be an advantage if you have multiple health conditions, because your primary doctor has a record of all your care and medications and can catch problems that might otherwise be missed.

It can also be a disadvantage if you prefer to manage your own care or if your preferred specialist is not in the plan's network. Some plans (called PPO plans) allow you to see specialists without a referral, though you may pay more out of pocket.

Plans change every year

Medicare Advantage plans are not static. Each year, plans can change their premiums, copays, deductibles, drug formularies (the list of covered drugs), and networks. A doctor you saw last year may no longer be in the plan this year. A drug you take may move to a higher copay tier or be removed from the formulary entirely.

This means you should review your plan's benefits and network every fall during the annual enrollment period (October 15 to December 7). If your plan no longer meets your needs, you can switch to a different Medicare Advantage plan or switch to Original Medicare. If you switch to Original Medicare, you have a limited window to buy a Medigap policy without being denied or charged more for pre-existing conditions.

Network restrictions and referral requirements

The main disadvantage of Medicare Advantage is that you are limited to the plan's network of doctors and hospitals. If you travel frequently or live part of the year in another state, a network plan may not work for you. Emergency care is covered anywhere, but non-emergency care out of network is either not covered or covered at a much higher cost.

Referral requirements can also slow down care. If you want to see a dermatologist or orthopedic surgeon, you must first see your primary doctor and request a referral. Some plans approve referrals quickly; others take longer. If your primary doctor denies a referral you believe you need, you can file an appeal, but this takes time.

Frequently Asked Questions

Is Medicare Advantage cheaper than Original Medicare?

It depends on how much health care you use. Medicare Advantage plans often have lower monthly premiums, but higher copays at the doctor's office. If you are generally healthy and see a doctor only a few times a year, Medicare Advantage may cost less overall. If you have multiple chronic conditions and see specialists regularly, Original Medicare with a Medigap policy may be cheaper.

Can I switch from Medicare Advantage back to Original Medicare?

Yes, during the annual enrollment period (October 15 to December 7) or if you have a may have access to life event like moving out of the plan's service area. If you switch to Original Medicare, you have 63 days to buy a Medigap policy. After that window closes, insurers can deny you or charge you more based on your health history.

What happens if my doctor leaves the Medicare Advantage plan?

You can continue seeing that doctor if they still accept Medicare, but you will pay out-of-network rates, which are usually much higher. You can also switch to a different Medicare Advantage plan during the annual enrollment period or file a complaint with your state insurance commissioner if you believe the plan's network is inadequate.

Do all Medicare Advantage plans cover dental and vision?

Most do, but coverage varies. Some plans cover only preventive dental care (cleanings and exams); others cover major work. Vision benefits may include only an eye exam, or they may include glasses or contacts. Review the plan's summary of benefits before you enroll to see exactly what is covered.

What if I need a service that my plan does not cover?

You can pay out of pocket, or you can file an appeal if you believe the service should be covered. If the appeal is denied, you can request an independent review by an outside organization. Your plan must provide information about how to file an appeal when they deny a service.