Ask Kim
Get the Best Medicare Advantage Plan
This step-by-step guide will help you compare options from private insurers to find the best coverage for your needs.
By Kimberly Lankford, Contributing Editor, Kiplinger's Personal Finance
November 16, 2009
Thanks for your step-by-step guide to picking a Medicare Part D prescription-drug plan. I would like to look for a Medicare Advantage plan during open-enrollment season this year instead of a Part D plan. What resources can help me compare Advantage plans?
Comparing Medicare Advantage plans is more complicated than shopping for Part D coverage because Medicare Advantage covers health-care as well as prescription-drug expenses. You can compare the overall costs -- premiums, co-payments and deductibles -- for the types of doctor’s visits, drugs and other medical care you typically receive. But you also have to look carefully at how the plan covers the more expensive care that you may need if you have an accident or become sick. And because Medicare Advantage plans often have more rules about which doctors and hospitals are covered, what preauthorization you need before getting certain types of care, and what procedures are excluded, it’s essential to study the coverage details and customer-service ratings before picking a plan.
Related Links
- TOOL: Find the Right Medicare Plan for You
- Get the Best Medicare Prescription-Drug Plan for You
- Choose the Right Medicare Plan for Your Needs
A bit of background: People 65 and older can choose to get health coverage either through a Medicare Advantage plan, which provides all benefits from a private insurer, or through Medicare, with a medigap policy to help cover deductibles and co-payments plus a separate Part D policy to cover prescription drugs. See Choose the Right Medicare Plan for Your Needs for more information about which type of plan is best for you.
You have from November 15 to December 31 to sign up for your 2010 Medicare Advantage plan (the same time frame for Part D open enrollment), and you can also change your Medicare Advantage plan once from January 1 to March 31.
There are three types of Medicare Advantage plans. Medicare HMOs have the lowest premiums but the most restrictions on which hospitals and doctors are covered, and HMOs generally will not pay for out-of-network care. Co-payments may be very low if you stay within the network. Regional preferred-provider organizations (PPOs) will charge a low co-payment if you stay within the provider network, which may span several states, but a higher co-payment for out-of-network care. Premiums tend to be higher than those charged by HMOs. And private fee-for-service plans usually charge the highest premiums, but they let you use any doctor or hospital that agrees to the plan’s terms.
Medicare.gov has a great tool to help you compare costs and coverage in your area for all three types of Medicare Advantage plans. Go to Medicare Options Compare and click on “Find & Compare Health Plans” to search for Medicare Advantage plans. You can do either a personalized plan search, based on your current enrollment information, or a general plan search. For the general plan search, type in your zip code and select your age range and health status (from excellent to poor). Then answer a few questions about what type of coverage you have now and whether you qualify for any low-income subsidies.
After clicking through a page with general information about open enrollment, you’ll be able to enter the names of your medications and can click on a box labeled “use lower-cost generic drugs when available” (which will lower your costs significantly). Then enter your dosages and refill frequency. You can set up a password to access the information later, or you can skip that step. You can then choose specific pharmacies in your area or keep the results more general.
Using the information you provide, the site compiles a grid listing the plans available in your area, the monthly premiums and the estimated annual cost for people like you (based on your health and your medications). You can sort by premium, estimated annual cost, or whether the plan covers drugs, provides doctor choice, or offers vision and dental services. Start by comparing the estimated annual cost, which includes the premiums plus estimated out-of-pocket costs for people with your health status.
Then you can select up to three plans to compare their health coverage and drug benefits in detail. The drug-benefits page will show the total costs based on the medications you entered.
It’s particularly important to click on the tab that lets you compare health-benefit details. You’ll see the plans’ star ratings in several quality categories, including preventive coverage, managing chronic conditions, health-plan responsiveness and care, member complaints, appeals, drug-plan customer service, and a few other categories. Look closely at these ratings because you’re counting on this policy to provide all of your medical coverage.
Next, you’ll see the premiums, followed by details about co-payments for several types of expenses within inpatient hospital care, outpatient care, outpatient medical services and supplies (such as X-rays), and prescription-drug coverage. You may find huge differences from plan to plan, especially considering that HMOs, PPOs and private fee-for-service plans are all included on the list. For example, one HMO available in St. Petersburg, Fla., charges a $100 co-payment for the first seven days in a hospital; another has a $275 co-payment for the first five days.
Before you make a final decision, make sure that the doctors and hospitals that you use are covered, and find out about any rules that require preauthorization before your treatment will be covered.
Another way to compare Medicare Advantage plans is by looking up the annual Cost Share Report from HealthMetrix Research. The report ranks the plans based on out-of-pocket costs for three types of health status -- good, fair and poor. Rankings are based on premiums, deductibles and co-payments for common health-plan benefits that people with a given health status use. The costs include physician office visits, emergency care, hospital care, prevention care and prescriptions. HealthMetrix also selects the top plan in 95 cities for the 2010 Senior Choice Gold Awards for excellence in Medicare Benefits Value.
Got a Question? E-mail Kim at askkim@kiplinger.com.
Reader Comments (9)
Posted by: al weiss at 11/16/2009 03:28:05 PM
i live in ft. myers, fl from oct. thru may, and our papers are saturated with full page ads for signing up with med. adv. plans. but summers i spend in NW. indiana, and want to point out that almost all plans will not know if they provide any coverage up north. from the gist of your article, it sounds like the most likely plans to cover all over the country would be the fee-for-service plans. if that is the case, how do those premiums compare with standard medicare with medigap for say plan G??? no planD hopefully congress will see that they can save billions yearly if they just abandon this Med. Adv. plans altogether, since all they are doing is paying the privates a 14% fee to run medical care for those over 65, cheaper than the govt can? has anyone actually studied any results on how Med. Adv plans compare with the old plans re- cost and results???
Posted by: V. Wu at 12/02/2009 02:46:07 PM
Why does this system have to be so complicated? Was this set up to torture seniors every year? I agree with the earlier reader that the simplest way is to do away with the Med Adv Plans and lower costs for all.
Posted by: jan at 12/02/2009 07:26:25 PM
I have (an) R.A. taking remicade in my vein every 8 weeks. It is a life saver for me. Which plan will help me and save money? It,s very expensive. Thanks for your help.
Posted by: Lee at 12/10/2009 03:27:10 PM
I am in my initial selection period and have been researching my options. I have discovered that there will be major changes to the Medicare supplements in June of 2010. These changes include elimination of some of the existing plans, changes to some of those that will remain as options, and the addition of two new plans. While all the current plans will be grandfathered into the future it appears that there may be better options available beginning in June of 2010. I have elected to join a Medicare Advantage plan for the time being because I have discovered that if it is my initial selection I have one year to decide if that was the best decision. If I decide to exit the plan before the one year time frame then I still have a guaranteed issue right ( I can not be refused because of a pre-exiting condition) for 63 days after I exit the Advantage plan. This gives me the ability to preserve my options to evaluate the new Medicare Supplement choices without any negative consequences. Do you concur with this strategy?
Posted by: escortrider at 12/16/2009 04:35:12 PM
In response to V. Wu who would like Medicare Advantage Plans done away with to "lower costs for all", that would raise, not lower, costs for everybody who now has one of those plans. If Medicare is spending too much on that type of plan, let their support be lowered, and the plans would have to charge us a little more premium. But don't do away with them, as that is the most efficient way to provide quality medical care. I am more than satisfied with mine (Kaiser in Los Angeles County).
Posted by: Cathy at 12/19/2009 06:25:35 AM
Obama plans to cut the funds for Medicare Advantage plans as AARP has been an advocate of that since their inception. Reason: AARP doesn't sell them, but they do sell the medi-gap plans for which they receive a kick-back from the insurance companies. They derive 60-80% of their income from these plans. They have supported the $500 billion cut in Medicare funding, and thousands of seniors have dropped their membership. With the cuts in Medicare due to be devoted to funding for new programs, the seniors' coverage will ultimately suffer. If the governments cuts the reimbursements to doctors and hospitals for Medicare, more and more of them will drop seniors or refuse to take any new ones. I would like nothing more than to be able to get out of Medicare, but as a senior what insurance company will insure me. Seniors are trapped and at the mercy of Washington. Our only recourse is at the ballot box in 2010, and we have the highest voting record of all age groups.
Posted by: Yolanda at 12/23/2009 11:38:32 AM
Last year, I turned 65. I enrolled in a Medicare Advantage Plan with Humana. I live in Palm Beach County, FL. I am very pleased with all that they have covered when it was discovered in October of this year that I have multiple myeloma..I thought I would be in big trouble financially and possibly lose my home since I've been unemployed for the last 2 1/2 years after being in paralegal for the last 18yrs. Needless to say, when the "C" word was pronounced by my doctor, I was devastated thinking of my mortality and my lack of $$$. But so far, Humana's Advantage Plan has been a God given gift to me with small copayments. I intend to stay with it unless they change next year...so far, so good. I recommend it.
Posted by: harry haag at 01/13/2010 03:47:57 PM
83 yrs. of age - wife 81 yrs. total monthly income me $1122.00 SS - Wife $487.00SS presently have advantra silver - no monthly premium but pay for all other charges,e.g. drs, visit, lab, x-rays. mri.etc. any better & cheaper plans?
Posted by: harry haag at 01/13/2010 03:49:07 PM
i forgoy one other thing - we do have Pacenet sorry