* Medicare Advantage plans typically cover the same services as Medicare.
* Medicare.gov rates Advantage plans with a five-star rating system.
* When comparing plans, research drug costs and in-network coverage.
Should you consider a Medicare Advantage plan?
As of 2010, one-fourth of the Medicare population was enrolled in a Medicare Advantage plan, according to the Kaiser Family Foundation. If you're fairly healthy, you might want to join the ranks. You can get expanded benefits such as vision care and more plan choices, especially in metropolitan areas, and most importantly, save money. In fact, a private Medicare plan or Medicare Advantage plan can cost just $50 per month, compared to $150 to $250 per month for Medicare and Medigap, according to the Medicare Rights Center.
Medicare Advantage plans typically cover the same services as original Medicare, including drug coverage, so you don't have to sign up for both plans. Medigap is a supplemental insurance policy used with Medicare that provides extra medical coverage.
The plans aren't without their caveats. Medicare Advantage plans are offered by private companies approved by Medicare. For many programs, you're limited to using in-network doctors only. There's also usually more cost sharing when you sign up for Medicare Advantage versus original Medicare.
Additionally, Medicare Advantage is aimed at people who stay close to home, says Ross Blair, CEO of the Medicare plan comparison site PlanPrescriber.com. You're tied to a specific doctor and network. If you leave the network, you may not be covered. Blair says the plans are best in metro areas, where a greater number of Medicare Advantage plans are offered.
Which type of MA plan is best for you?
Most people sign up for Medicare HMOs rather than PPOs, according to the Kaiser Family Foundation. Health maintenance organizations, or HMOs, usually get higher ratings than preferred provider organizations, or PPOs, but you can only use your in-network doctor. Conversely, PPOs may cover some of the medical costs outside a network.
A third option -- private fee-for-service, or PFFS, plans -- should be avoided, says Blair. Costs can run higher than original Medicare plans, and doctors may be harder to find because you're not part of a network.
Within these categories, plans vary widely. Some may cover vision or dental, others enhanced drug coverage. The key is looking at total annual plan costs, copays and deductibles, says Blair.
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