Posts Tagged ‘Medicare Advantage Plans’

Changes in Medicare Advantage Plans

Thursday, April 30th, 2015

Medicare Advantage plans are used by more than 16 million elderly and disabled people. The system, an alternative to traditional Medicare, allows private insurers to manage health care benefits.

Reimbursement rates for insurers are announced by the government each April, allowing health insurance companies to plan which options to provide and in which areas to compete. The increase comes after Medicare Advantage payments had been cut for several years in a row, due to changes under the Affordable Care Act and declining spending on health care costs. The government said that the increase in payments was in response to expected growth in health care spending.

Payments that the U.S. government makes to health insurance companies operating Medicare Advantage plans will go up by 1.25 percent in 2016, a division of the U.S. Department of Health and Human Services announced. In February, the government proposed a 0.95 percent cut in payments to insurers.

The increase is good news for insurers, and perhaps for health care consumers as well. Health insurance companies had warned that cuts in payments could harm the elderly, because fewer insurers would find it profitable to compete in the marketplace, reducing consumer choice.

People who are eligible for Medicare have the opportunity to switch from original Medicare to a Medicare Advantage plan, or vice versa, or switch from one Medicare Advantage plan to another, during the open enrollment period from October 15-December 7.

Choosing A Medicare Advantage Plan

Monday, November 10th, 2014

Medicare beneficiaries have a choice in health plans. They may choose Medicare Part A (hospital insurance) and Part B (physician and outpatient coverage), which together are also known as traditional or original Medicare, or they may choose Part C, a Medicare Advantage plan, which replaces Parts A and B. Medicare Advantage plans also usually come with their own prescription drug plan, thereby replacing Medicare Part D as well.

Medicare Advantage plans are offered by private health insurance companies that contract with the government to provide Medicare benefits. Most of them are managed care plans similar to preferred provider organizations (PPOs) or health maintenance organizations (HMOs). Medicare Advantage plans may cost more than traditional Medicare, but they may also offer additional benefits. It is important for beneficiaries to understand the options in order to make the best choice for their circumstances. For many, traditional Medicare is the default choice, but there are reasons why beneficiaries may prefer Medicare Advantage.

Some people may prefer the way Medicare Advantage plans handle prescription drug coverage. Most of them include prescription drug coverage in the cost of the plan, so the extra cost of Medicare Part D can be avoided. However, the total that beneficiaries pay depends on what prescriptions they have. The Medicare Plan Finder at Medicare.gov can help individuals determine how much they would pay for prescription drugs under various plans.

Another reason people choose Medicare Advantage plans is the limits on out-of-pocket spending. Under traditional Medicare, there is no out-of-pocket maximum, but Medicare Advantage plans are restricted to a cap for out-of-pocket expenditures. Whether a beneficiary would meet that cap depends on individual circumstances. In addition to the cap, Medicare Advantage coinsurance payments may be structured in a more beneficial way.

Beneficiaries may also choose Medicare Advantage because they want vision or dental plans included, or they want an alternative to purchasing “Medigap” coverage to pay for costs that traditional Medicare does not cover. Individuals should examine the costs and benefits of plans carefully to determine the right choice for them.

 

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