What Is a Medicare Advantage Plan?
When you sign up for Medicare at age 65, there are certain benefits all beneficiaries receive and additional plans you can opt into as a way to supplement your benefit package.
What Do Medicare Parts A, B, C and D Mean?
Medicare Part A is hospital insurance, and Part B is medical insurance. Both Parts A and B require deductibles, coinsurance and/or copayments, similar to a private insurance plan. Medicare Part D includes prescription drug benefits and requires an additional premium and copayments depending on the plan.
Medicare Part C, which is also known as Medicare Advantage, allows you to buy one plan that includes Parts A, B and D from private health insurance companies plus any additional benefits you would like covered. The plan may or may not have a small premium.
If this seems a little complicated, it’s because it is. Medicare is an ever-evolving benefit plan that requires experts to dig into the nuances and explain them to those of us who need to think about enrolling in Medicare. Luckily, Doug Robertson, Healthcare Regulation and Compliance Manager at Right at Home, has in-depth knowledge of Medicare Advantage plans and the evolving reimbursement strategies within the healthcare industry. We spoke with Robertson to help us better understand Medicare Advantage and the recent Centers for Medicare & Medicaid Services (CMS) rule changes that now allow additional supplemental benefits, which can include home care, in Medicare Advantage plans.
How Medicare Advantage Works
“Medicare Advantage plans include the benefits of Parts A and B, and normally also include Part D, which is prescription drug coverage,” says Robertson. “Medicare Advantage plans can include smaller ancillary benefits like vision, dental and now home care.1
While Medicare provides the same benefits regardless of geography, Medicare Advantage plans can differ from county to county and certainly from one state to the next.
In April 2018, the CMS announced rule changes that allow insurance carriers to include additional supplemental benefits so long as they are used to diagnose, prevent or improve the effects of injuries or health conditions, or reduce avoidable emergency department visits. This broadened the covered benefits to include services like in-home support services.
According to Robertson, an insurance carrier develops a Medicare Advantage insurance plan and a network of providers—like health maintenance organizations (HMOs) and preferred provider organizations (PPOs) that we are familiar with prior to signing up for Medicare Advantage—then the carrier submits the plan to the federal government for review and approval. Part of what the government looks at is the expected cost to the insurance carrier for offering their plan. If their plan is approved, the government will issue payment to the carrier to cover the expected costs, but the carrier is responsible for managing the care of plan members with that capped amount over the next calendar year.
Open enrollment for Medicare-eligible participants happens every year from October 15 through December 7. It’s during this time period that you can choose to opt into a Medicare Advantage plan.
The Benefits of Medicare Advantage Plans
Robertson has found that Medicare Advantage plans have grown in popularity with Medicare beneficiaries over the years. While only 13% of Medicare beneficiaries chose Medicare Advantage plans in 2004, that number shot up to 34% in 2019, and is expected to reach 47% by 2029, according to the Kaiser Family Foundation.
“The three advantages of Medicare Advantage as I see them are the annual maximum out-of-pocket costs of no more than $6,700,2 the prescription drug coverage, and dental and vision coverage,” Robertson tells us. “Medicare does not have a cap for out-of-pocket costs, requires an additional premium for prescription drug coverage through a Part D plan, and does not cover routine dental and vision care.”
Facts About the Medicare Advantage Benefits Expansion
Seeing a growing need for additional services, the Medicare Advantage rules have recently been loosened to include additional benefits such as transportation to/from medical appointments, telemedicine, and even in-home care. When it comes to home care benefits, Robertson cautions people to read the fine print closely when enrolling in Medicare Advantage plans.
“Medicare Part A includes intermittent skilled home care services up to 35 hours a week, but in a very limited capacity,” Robertson says. “In most cases, this means it will cover about 30-90 minutes of care from a nurse to address a specific need, like wound care, or medication management. If you want to make sure you’re covered for the activities of daily living (ADLs), such as eating, dressing, bathing or grooming, look for a Medicare Advantage plan in your area that covers that. But again, not all plans cover those needs, so be sure to check the explanation of benefits during open enrollment to determine if in-home supportive services are included before enrolling.”
1 Disclaimer: Because the federal government does not track which plans include home care, the number of Medicare Advantage plans that include it is unknown.
2 Kaiser Family Foundation. (June 2019). A Dozen Facts About Medicare Advantage in 2019. Retrieved from https://www.kff.org/medicare/issue-brief/a-dozen-facts-about-medicare-advantage-in-2019/.
Hilary Young is a writer dedicated to helping older Americans live healthier, more fulfilling lives. You can find her on Twitter as @hyoungcreative.
