How to Choose a Medicare Advantage Plan

Dear Savvy Senior,

I will be 65 and eligible for Medicare in a few months and am interested in getting a Medicare Advantage plan to cover my health care and medications. What tips can you provide to help me pick a plan? 

Ready to Retire

Dear Ready,

Medicare Advantage plans have become very popular among retirees over the past 15 years, as nearly half of all new Medicare enrollees are signing up for Advantage plans, which account for about 42 percent of the entire Medicare market. Here are some tips and tools to help you pick a plan that fits your needs.

First, let’s start with a quick review. Medicare Advantage plans (also known as Medicare Part C) are government-approved health plans sold by private insurance companies that you can choose in place of original Medicare. The vast majority of Advantage plans are managed-care policies such as HMOs or PPOs that require you to get your care within a network of doctors.

If you join an Advantage plan, the plan will provide all of your Part A (hospital insurance) and Part B (medical insurance) coverage like original Medicare does. But many plans also offer extra benefits like dental, hearing, and vision coverage along with gym/fitness memberships, and most plans include prescription drug coverage too. 

Medicare Advantage plans are also cheaper than if you got original Medicare, plus a separate Part D drug plan and a Medigap policy. Many Advantage plans have $0 or low monthly premiums and don’t always have a deductible, but they also typically have a high out-of-pocket maximum. In 2021, Advantage plan participants on average were responsible for a maximum of around $5,100 for in-network care, and about $9,200 when out-of-network care is included.

How to Choose

To help you pick a plan, a good first step is to call the office managers of the doctors you use and find out which Advantage plans they accept, and which ones they recommend. Then go to the Medicare Plan Finder tool at Medicare.gov/plan-compare to compare Advantage plans in your area. This tool provides a five-star rating system that evaluates each plan based on past customer satisfaction and the quality of care the plan delivers. When comparing, here are some key points to consider:

Total costs

Look at the plan’s entire pricing package, not just the premiums and deductibles. Compare the maximum out-of-pocket costs plus the copays and coinsurance charged for doctor office visits, hospital stays, visits to specialists, prescription drugs, and other medical services. This is important because if you choose an Advantage plan, you’re not allowed to purchase a Medigap policy, which means you’ll be responsible for paying these expenses out of your own pocket. 

Drug coverage

Check the plan’s formulary – the list of prescription drugs covered – to be sure all the medications you take are covered without excessive co-pays or requirements that you try less expensive drugs first. 

Dental, vision, and hearing

Many Advantage plans come with dental, vision, and hearing benefits, but are usually limited. Get the details on what exactly is covered.

Coverage away from home

Most Advantage plans limit you to using in-network doctors only within a service area or geographic region, so find out what’s covered if you need medical care when you’re away from home. 

Out-of-network coverage

Check to see what’s covered if you want to see a specialist in a hospital that is not in a plan’s network. You can get a list of doctors and hospitals that take part in a plan on the plan’s website. 

Need Help?

If you need help choosing a plan, contact your State Health Insurance Assistance Program at ShipHelp.org or call 877-839-2675. Also, see the HealthMetrix Research 2022 Cost Comparisons Report at MedicareNewsWatch.com which lists the best Advantage plans based on health status. 

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