What Would Work Better for You? Deciding Between Traditional Medicare and a Medicare Advantage Plan

In last week’s Alert, we posed 10 questions to ask before deciding between traditional Medicare and a Medicare Advantage Plan. This week we discuss what your answers may mean.

  1. Do you qualify for payment assistance or have access to other coverage through any of the following
    1. Medicare Savings Program?
    2. Part D Low Income Subsidy?
    3. Employer/Military/Other Insurance?
    4. Medigap Plan?

Response: Contact the State Health Insurance Program (SHIP) in your state to find out if you might qualify for financial assistance and to compare the options available to you for Medigap and Medicare Advantage plans. https://www.shiptacenter.org/. This information will give you a base by which to compare all the price options and then answer the remaining questions to determine which coverage options are best for you.

  1. Which providers/facilities will you want to use?
    1. How important is it to you to continue seeing them?
    2. Do they accept Medicare?
    3. What Medicare Advantage Plan networks do they participate in?

Response: Many people have providers (doctors, specialists, pharmacies, therapists, hospitals) they have gone to for years and they want to continue seeing. Others will want to be sure they will have access to any specialists and facilities they may need. Traditional Medicare will let you use the services of anyone who is a Medicare participating provider – which includes most providers. If you elect to join a Medicare Advantage plan, you usually have to see the contracted providers in their network or receive reduced or no coverage. If keeping your providers is important to you, make sure they are in the network of any Medicare Advantage plan you consider joining. If the providers you want or may need are not, or may not be, in the Medicare Advantage plan networks, you may wish to elect traditional Medicare.

  1. Are you comfortable with your care choices being directed…
    1. By going through a primary care physician?
    2. By obtaining referrals to see specialists?
    3. By having to get prior authorization for some services?

Response: In traditional Medicare, there are no required “gatekeepers” to services. As long as the care is reasonable and necessary, you can go directly to the providers to receive Medicare-coverable services. In Medicare Advantage, you typically must go to the “gatekeeper” (usually a primary care provider) who will then determine if you need to be referred for additional care. If making your own decisions about your health care and provider choices is important to you, you may wish to choose traditional Medicare.

  1. Do you travel outside your general home area?
    1. How often?
    2. How do you feel about having care access limited to emergency coverage and urgent care if you are outside your general home area?

Response: Traditional Medicare coverage is available in all U.S. States and Territories. Wherever you are in the U.S., you have access to Medicare-covered care. Medicare Advantage plans have networks that typically limit care to a small geographic area; if you need care outside that area, coverage from the plan will likely only be for emergency situations. To get more extensive care under Medicare Advantage, you will have to get yourself back to your plan network area. If you travel outside that area, you may prefer coverage through traditional Medicare.

  1. What medications do you take?
    1. What Plan’s formularies include your medications?
    2. How much are the co-payments for your medications?
    3. Can you take generic medications?

Response: Whether you are considering traditional Medicare or Medicare Advantage, find out if your medications are covered by visiting the Part D or Medicare Advantage Prescription Drug Plan Finder at https://www.medicare.gov/find-a-plan/questions/home.aspx. Once you determine if your medications are covered and under what plans, it will give you more information to make your decision about which Part D plan or Medicare Advantage plan to choose.

  1. How important are limits on your annual maximum out-of-pocket costs?

Response: Traditional Medicare does not have an annual out-of-pocket cost maximum. If you can obtain cost-sharing assistance (as determined by question #1), you may have coverage to address this risk. Medicare Advantage Plans have annual out-of-pocket maximums for covered Parts A and B services (typically $6,200 in 2016). These out-of-pocket maximums do not include most prescriptions or costs for non-Parts A and B services (e.g. dental), so out-of-pocket costs on Medicare Advantage may run higher than the expected maximum.

  1. What is the value for you of some coverage for other possible services?

(Examples: Dental, hearing and/or vision care, health club membership.)

Response: Medicare Advantage plans may offer some coverage for services that are not covered under traditional Medicare. Some of this “additional’ coverage is often limited to plan network “brand” items, or may only be of use to healthy beneficiaries, while some may be of more general use.  This limited-dollar-value benefit should be weighed in consideration of all the major medical coverage that a beneficiary may require.

  1. How do you weigh the convenience of staying with a coverage option for most of your care versus continual annual checking to ensure providers/coverage requirements are not changing?

Response: Coverage in the traditional Medicare program rarely changes. As long as your provider is participating in Medicare, you have access to the coverage. On the other hand, in Medicare Advantage, providers (doctors, specialists, pharmacies, therapists, hospitals) change annually, and even during the year, due to their individual contracts with the MA plan. Providers do not have to wait for open enrollment to terminate their contracts. You have more assurance of coverage stability in traditional Medicare. So, what many consider as the “convenience” of Medicare Advantage’s one-stop-shopping at the outset (combining Parts A, B, and D),  becomes less convenient as the right Medicare Advantage plan for you must be reviewed on a continuing basis.

  1. How do you feel about a Medicare Advantage plan potentially having the ability to challenge your doctor’s determination that your care is reasonable and necessary?

Response: In traditional Medicare, your provider determines if your care is reasonable and necessary. In Medicare Advantage, the Medical Director of the plan, or the Utilization Review Team of the plan, can overrule the determination of your provider. The providers may give up some of their autonomy to be able to participate in the Medicare Advantage plan network. If you want your doctor to decide if your care is reasonable and necessary, you may want to choose traditional Medicare.

  1. Will you be more likely to seek care if it is…
    1. Easily accessible (Almost all providers/suppliers are available)?
    2. Convenient (Coverage available for care in most geographic areas)?
    3. Lower cost?

Response: Remember that Medicare Advantage plans have networks of specific providers that are limited to certain geographic areas.

Review your responses to the questions posed in this Alert, both financial and coverage related, to reach the conclusion that best fits your needs and circumstances. Make a fully informed decision!