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Medicare Advantage Plans Explained

Medicare, a federally funded health initiative, has been providing affordable health insurance options for seniors since 1965. Shortly after that, Medicare Advantage entered the industry. Medicare Advantage, also known as Medicare Part C, provides comparable health plans through private insurance companies.

But what does Medicare Advantage actually provide, and is it right for you?

In this article, we’ll take a comprehensive look at this popular health option and how it compares to the original Medicare coverage.

The A, B, Cs of Medicare

Medicare health plans are broken up into three parts—Part A, Part B, and Part D.

  • Part A: Medicare Part A is also called hospital insurance. This covers inpatient hospital visits, skilled nursing facilities, hospice, and parts of home health care. Many people don’t pay a monthly premium for this section.
  • Part B: Part B is considered Medicare’s medical insurance and covers preventative care, medical supplies, doctor visits, and outpatient care. Unlike Part A, the Part B premium varies each year depending on your income.
  • Part D: Part D is prescription drug coverage. This is an optional add-on, and prices vary depending on the plan.

Medicare Advantage: Part C

Medicare Advantage plans are growing in popularity and have over 28 million enrollees as of 2022. Unlike the original Medicare plans, Medicare Advantage plans are offered exclusively through private companies. However, that doesn’t mean that everyone gets to make their own rules. Rather, companies are still required to follow the rules set by Medicare and, in turn, will receive a fixed amount from them each month.

What you should expect to be different are your out-of-pocket costs and how you see providers. Generally, you’ll need to utilize those within your plan’s network or have a referral. Remember that these guidelines could change each year, so you’ll need to look at your policy each time you renew.

In general, Medicare Advantage plans offer the same services you’d find in Medicare Part A, B, and D, plus some additional benefits, like dental and hearing. Customers also enjoy caps on out-of-pocket costs, although you have the added stress of dealing with in-network providers.

Types Of Medicare Advantage Plans:

Infographic of someone looking into a medicare advantage plan at a hospital

When deciding on a Medicare Advantage plan, you have a few different coverage options. Here is a breakdown of the major types of plans.


HMO plans (Health Maintenance Organization plans) utilize a strict network. Patients with an HMO will interact almost exclusively with a primary care doctor, with a focus on preventative care and wellness. If you wish to see a specialist in any area, you’ll need a referral, except for times of medical emergencies. The plus side of an HMO plan is that they generally offer lower monthly premiums thanks to the managed care model and strict service area.


PPO stands for Preferred Provider Organizations. This model of health care also utilizes a network of preferred providers. However, unlike an HMO, you can still access out-of-network—you’ll just pay a higher copayment to do so. PPOs tend to be more flexible with covered services than HMOs, but you’ll also pay more for this type of plan.


Special Needs Plans are designed to serve people with specific healthcare needs, have disabilities, or who are also enrolled in Medicaid. Because these plans are designed to work with specific conditions, benefits are also tailored to the patient.

An SNP is available either as an HMO or PPO plan and has the same covered services as Medicare Part A & B. However, patients may also enjoy additional benefits, like extended hospital stays.

There are three types of SNPs available:

  • D-SNP: Dual Eligible SNP for those enrolled in both Medicare and Medicaid
  • C-SNP: Chronic Condition SNP for those with a specific chronic condition
  • I-SNP: Institutional SNP for those who have or are expecting to need long-term care in a facility.

Plan details and benefits will vary.


An MSA, or Medical Savings Account, is similar to the Health Savings Account (HSA) you may have had before qualifying for Medicare. With an MSA, you choose your health providers without worrying about a network.

These accounts are broken down into two parts—a high-deductible health plan with a savings account.

Each year, your plan will deposit funds into an account. Unlike other options, you can fully control your care with an MSA. You can choose to use money from your account to pay for your Medicare costs before you hit your deductible.

Keep in mind that not everyone will qualify for an MSA account. See to determine your eligibility.


A Private Fee-For-Service Plan is another option you have when picking out your Medicare Advantage health coverage. This type of plan pays providers on a fee-for-service basis and doesn’t restrict patients to a network, although networks are available. However, unlike other options, your PFFS plan will utilize either a full network, partial network, or omit the network altogether. 

Like traditional health insurance, your plan will send a cost-sharing breakdown each year, so be sure to keep an eye out for your Annual Notice of Change and Evidence of Coverage.

In order to qualify for a PFFS, you must be enrolled in Medicare Part A and Part B. You should also expect to pay an additional monthly premium outside of your Part B premium.

Do I Have To Enroll In Medicare To Get Medicare Advantage?

Before qualifying for any Medicare Advantage plan, you’ll need to have Medicare Part A and Part B in place—there is no bypassing Medicare when choosing Medicare Advantage.

When Do I Enroll In A Medicare Advantage Plan?

The Medicare initial enrollment period opens three months before you turn 65 and closes 3 months after your birthday. This is your chance to get Medicare Part A & B. If you miss your chance, or if you are just reapplying for Medicare coverage, you will utilize the annual open enrollment window (usually October 15- December 7).

If you’re enrolled in a Medicare Advantage plan, you will also have an enrollment window from January 1-March 31.

Is Medicare Advantage The Same As Medigap?

While Medigap also provides extra benefits beyond the Original Medicare coverage, they are separate. Medigap is a Medicare supplement to fill in the gaps of Part A & B. Your Medigap policy is designed to cover your out-of-pocket expenses.

Medicare Advantage acts as an alternative to Medicare, functioning more like traditional health insurance.


Medicare is a great way to get affordable healthcare past the age of 65. Unfortunately, there are a number of gaps in coverage. One popular way to fill in the gaps is to sign up for a Medicare Advantage plan. If you want more flexibility than the Original Medicare offers, this option may be a great fit. These plans operate like traditional healthcare, and you can choose from a variety of plan types to find one that best fits your needs.

You might also be interested in: Cobra Insurance – Explained [Plus 4 Qualifying Events]

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