Millions of seniors today get health coverage through Medicare. Right now, in fact, Medicare's annual open enrollment period is underway, which means existing health plan participants have an opportunity to make changes to their coverage and take steps to lower their costs for 2024.
Unfortunately, though, there tends to be a lot of confusion about Medicare. That can lead to poor decision-making -- and extra spending on healthcare for seniors on fixed incomes.
A recent survey from Assurance IQ found that Medicare enrollees are confused about different aspects of the program, including some of its terminology. But surprisingly, 59% of those surveyed did not fully understand what Medicare Part C entails. If you feel that you're in the dark, too, here's what you need to know.
Image source: Getty Images.
Understanding Medicare's different parts
Medicare consists of several different parts. Under original Medicare, you have:
- Part A, which covers hospital care
- Part B, which covers diagnostics and outpatient care
- Part D, which covers prescription drugs
There's also Medicare Part C, which is also known as Medicare Advantage. This is an important option to know about.
Medicare Advantage is basically an alternative to original Medicare. Instead of paying for original Medicare plus a drug plan, with Medicare Advantage, you generally sign up for a single plan that covers all of your health-related needs, prescriptions included.
Why might you sign up for Medicare Advantage, or Part C? Well, there are a few reasons. Namely, with Medicare Advantage, you might:
- Spend less on healthcare from year to year due to Advantage plans putting a cap on out-of-pocket costs (something original Medicare doesn't do)
- Get access to a wider range of benefits beyond what original Medicare covers (such as dental cleanings and eye exams)
- Save money on premiums
This isn't to say that you're guaranteed to reap these benefits. But you might, and that's why it pays to look into your options for coverage under Medicare Advantage during open enrollment, which runs through Dec. 7.
Know the pros and cons
For some people, signing up for Medicare Advantage is a great way to save money on healthcare. But there are some drawbacks to Medicare Advantage, too.
For one thing, you'll generally be limited to a specific network of providers. And going out of network could prove costly. You might have fewer restrictions on which providers you can see if you stick with original Medicare.
Your costs under Medicare Advantage may not come in lower than under original Medicare if you have a lot of health issues. And while Medicare Advantage plans do offer supplemental benefits, you're not guaranteed to qualify for every extra benefit your plan offers. That means you could end up paying for benefits you don't get to use.
All told, Medicare Advantage is a good option for some people, but not everyone. Either way, it's important to understand what it entails. It's also important to explore your plan choices while you still have the option to sign up in case you decide that it is, in fact, the best route to take.
