Medicare Advantage is an alternative to traditional Medicare. For many retirees, Medicare Advantage plans seem attractive because they allow you to get insurance from a private health insurance company that may provide more coverage than the government does.
If you've signed up for a Medicare Advantage plan, though, there may be some potential problems with your plan that you aren't even aware of until the time comes when you need to get healthcare services. You don't want to find out the hard way that your Advantage plan isn't all it's cracked up to be, so consider these three reasons why you may want to ditch your plan this year.
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1. Out-of-network benefit issues when traveling
As part of the retirement planning process, many retirees dream of seeing the world, or at least hitting the road and seeing some of the United States that they didn't have the chance to visit while working.
Traveling can be a great way to spend your free time as a retiree, but if you have a Medicare Advantage plan, you could be faced with a big problem. Medicare Advantage plans usually have networks, and if you don't see an in-network doctor, your non-emergency care may not be covered, or you may have much higher out-of-pocket costs to pay.
The problem is, networks are usually local. So, if you've gone on a trip and left your network of doctors behind, you may not have many, or any, covered care providers. This becomes a problem not just for wanderers who are seeing the world, but for any senior who wants to go visit their grandkids or become a snowbird and escape cold weather for a while.
With original Medicare, this isn't an issue since Medicare Part B is accepted by doctors nationwide, so you'll only have to worry about health insurance coverage if you go abroad.
2. Possibility of denials
An increased risk of denials is another good reason to ditch Medicare Advantage plans this year. With traditional Medicare, you don't usually need pre-approval for covered services, and you aren't going to risk an insurer telling you that the care you want isn't going to be paid for.
You do face this risk with Advantage plans, though. If you don't want to have to fight with an insurance company to pay for services, ditching Medicare Advantage could be a better move.
3. Narrow networks
Finally, remember those networks mentioned above? They can sometimes be pretty narrow, even within your geographic region.
This means you may have a hard time finding a doctor to see you, especially if you need a specialist. Your network can also change from year to year, so if you have a doctor you love, there's no guarantee that you'll be able to keep seeing that doctor in subsequent years without changing your health insurance plan.
Again, this isn't an issue with original Medicare since the "network" includes every doctor that accepts Medicare coverage (which is pretty much every physician that provides care to seniors).
Should you ditch your Medicare Advantage plan?
All of these issues are good reasons to stop relying on Medicare Advantage. However, you'll need to go back to traditional Medicare if you drop your plan -- and that could leave you at risk of big coverage gaps and large coinsurance costs since Medicare Part B excludes many services like hearing aids and dental care, and requires you to pay 20% of most covered services.
Medigap policies can help to fill the gaps left by Medicare, but if you don't sign up for Medigap plans during your initial enrollment, it could be harder and more expensive to do so later.
Still, it's worth carefully considering the Medicare Advantage disadvantages and exploring your options to see if there is a better alternative that could help you avoid the risk of raiding your retirement plans to pay for healthcare costs if something goes wrong.
