More than 60 million people get health coverage through Medicare, about one-third of whom choose to get benefits through Medicare Advantage instead of original Medicare. Advantage plans are offered by private insurers and limit you to a specific network of providers, but can be more cost-effective than original Medicare. If you're thinking of getting an Advantage plan for 2021, here's what you need to know.
1. You can sign up for a new plan during fall open enrollment
Medicare's annual open enrollment has been underway since mid-October, so if you're on original Medicare, explore your Advantage plan options and lock in coverage for the new year. You have until Dec. 7 to sign up for an Advantage plan. If you haven't begun the research process, now's the time to get moving.
2. You can switch your plan during Medicare Advantage's winter open enrollment
Medicare Advantage actually has its own open enrollment period that runs from Jan. 1 through March 31 annually. During this time, you have the option to dump an existing Advantage plan and either replace it with another one or revert back to original Medicare. If you're new to Medicare Advantage, this presents a good opportunity for you to try a plan, see if you like it, and make changes early in 2021 rather than getting stuck with that plan for the entire year.
3. You can generally choose from more than 30 different plans
The average enrollee will have access to 33 Medicare Advantage plans for 2021, reports the Kaiser Family Foundation. However, enrollees in rural areas may have much fewer options, and in 82 U.S. counties, there's no Advantage plan available at all.
4. You may be able to find a $0 premium plan
Since Medicare Advantage frequently covers services that original Medicare doesn't, like dental care and vision exams, many people assume it's costly. But actually, an estimated 54% of Advantage plans don't charge their own premium at all, and an estimated 96% of enrollees will have access to one of these plans for 2021.
5. Hospital care might cost more
Medicare Advantage can be a cost-effective alternative to original Medicare, but not always. Hospitalization may incur extra costs. With original Medicare, you'll pay a Part A deductible of $1,484 per hospital stay in 2021, but from there, you won't face any coinsurance for the first 60 days of care. Many Advantage plans, on the other hand, charge a daily copay that can drive up costs for an extended hospital stay. In fact, for a hospital stay lasting just five days or longer, at least 50% of Medicare Advantage beneficiaries would be on the hook for higher out-of-pocket costs than those on original Medicare.
Clearly, there are pros and cons to enrolling in Medicare Advantage. At the very least, it's worth exploring your plan options and seeing if one suits you. You may find that you not only save money with an Advantage plan, but also access superior healthcare.