Laying a Solid Foundation | Lesson 4

Medicare Advantage Costs

One of the most important factors when making a health care choice is understanding the costs in the plan. Medicare Advantage is no different.

In this lesson, we’ll cover the costs that your client can expect in a Medicare Advantage plan. Let’s start with monthly costs.

Medicare Advantage plans have a monthly premium. Many plans offer a low or $0-premium option.

Your clients will have to pay their Part B premium in addition to their Medicare Advantage monthly premium; however, ome plans offer a Part B reduction or premium giveback feature that can help your clients with those Part B premium costs.

Next, let’s cover deductibles. Medicare Advantage plans usually include a deductible for both their health care costs and their drug costs, if it includes prescription coverage.

Like all deductibles, this is the amount that your client would pay out of pocket before the coverage of the plan takes effect. Just like the premium, some Medicare Advantage plans offer $0 deductibles for their health and drug coverage.

In addition to the deductibles, there are out-of-pocket costs, like copays or coinsurance, that your client will have to pay for some medical services. Some examples of this could include a $5 copay to see your primary care physician or a $25 dollar copay to see a specialist. Some of the other costs your client might be concerned about include doctor visits, hospital stays, or the cost for their prescriptions in the plan.

Medicare Advantage plans offer a little bit of financial protection by setting a maximum out-of-pocket limit for the year. If a client reaches that amount, their plan should cover the remainder of the year’s costs for Medicare-covered services. Out-of-pocket costs like deductibles, copays, and coinsurance for Medicare covered services count towards your client’s maximum out-of-pocket limit.

One of the best resources for reviewing the costs in a Medicare Advantage plan is the Summary of Benefits. This reviews all of the costs that we reviewed in this lesson, as well as other items like dental, mental health benefits, and prescription drug costs. Ritter’s Medicare Quote Engine and MedicareCENTER, available through our partnership with Integrity, are great resources for comparing Medicare Advantage plans in any given county. These tools allow you to look at basic information of any Medicare Advantage plans, as well as compare plans and their benefits side by side.

Before we wrap up, it’s important to note that the cost structure is gonna look very different from one Medicare Advantage plan to another. There could be other variations based on the type of MA plan. For example, PPOs are gonna have a different maximum out-of-pocket limit for in-network services compared to out-of-network services. An MSA plan’s cost structure is going to look very different than what an HMO plan’s might look like.

With all of these variations, it’s important to understand what cost your client is most concerned about. Factor that in along with their health needs and their financial needs when you’re making a recommendation.

Your client will choose a plan based on your recommendations, but then how do you enroll them? Head on over to the next lesson where we’ll talk about the Medicare Advantage enrollment periods.

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