What are the pros and cons of Medicare Advantage (Part C) plans?


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Every single person who goes onto Medicare is going to sign up for Original Medicare. Original Medicare, Parts A and B, is going to leave you with an uncapped 20% gap. You need insurance to cover this 20%. 

You have 2 options. The first is a Medicare Supplement. The second is a Medicare Advantage plan. You can’t have a Medicare Supplement and a Medicare Advantage plan at the same time.

Both insurance options get misrepresented; neither is the “good” or “bad” option. What you need to do is find the insurance that is going to work for you; pays your bills, allows you to go to the doctors you want, and, most importantly, gives you peace of mind. For some, this is going to be a Medicare Advantage plan.

Medicare: Medicare Advantage Pros and Cons

Medicare Advantage plans, also referred to as Part C of Medicare, is the name of an insurance plan which is offered by private insurance companies. When you elect to have a Medicare Advantage plan, the private insurance company replaces your Medicare coverage from the government.


What is a Medicare Advantage Plan? 

Medicare Advantage plans, also referred to as Part C of Medicare, is the name of an insurance plan which is offered by private insurance companies. When you elect to have a Medicare Advantage plan, the private insurance company replaces your Medicare coverage from the government. 

The same private insurance companies that sell Medicare Advantage plans sell Medicare Supplements, which can be confusing. These are companies such as Humana, AARP UnitedHealthcare, Cigna, Blue Cross and Blue Shield, and many more.  Just make sure to be clear on what option you are looking at. 

To make this election, you must first be enrolled in Part A and Part B of Medicare. You are still responsible for paying the monthly premium for Part B ($144.60 in 2020 for most), even on a Medicare Advantage plan. 

By law, Medicare Advantage plan’s benefits must be equivalent, if not better, than Original Medicare under law. 

Medicare Advantage plans make your Medicare act a lot like the coverage that most people get through work before age 65. The private insurance company covers you, you have co-payments and deductibles, and you have to go to doctors in the plans network. We break down who these plans do and do not work well for below! 

What are the pros of a Medicare Advantage plan? 

There are many people that a Medicare Advantage plan really works well for.  For them, these pros outright the cons: 

  • Medicare Advantage plans are more affordable
    The number one pro of a Medicare Advantage plan is that it is the most affordable option for Medicare coverage.Most Medicare Advantage plans have either zero or a low monthly premium.  As a comparison, a Medicare Supplement costs around $100-$200/month.There are deductibles and co-payments, but there is a yearly out-of-pocket maximum.

    Most people who choose this either cannot afford a Medicare Supplement or consider themselves really healthy and do not want to pay for a Medicare Supplement when they only go to the doctor once per year.

  • Medicare Advantage plans include drug coverage
    Unlike a Medicare Supplement, where you have to get a separate drug plan, almost all Medicare Advantage plans are going to include drug coverage.That means you do not have to go out and purchase a separate plan just to cover your drugs.
  • Medicare Advantage plans include extras like dental, vision, hearing, and wellness benefits
    Many Medicare Advantage plans include extra benefits. This includes limited dental, vision, and hearing coverage. If you are on a Medicare Supplement, you are going to have to buy coverage for these in a separate plan.

    Some Medicare Advantage plans include wellness benefits, such as SilverSneakers, or an equivalent, that will pay for your gym membership. 
    While we don’t advocate for making a decision about your Medicare coverage based solely on these extra benefits, they are great additions to any plan.

What are the cons of a Medicare Advantage plan? 

With the lower price and extra benefits that Medicare Advantage plans offer, there are some requirements and restrictions that you must be aware of. 

  • Medicare Advantage plans have networks
    For most people who do not end up with a Medicare Advantage plan, this is the reason. Medicare Advantage plans require you to go to their doctors and their hospitals, while Medicare Supplements allow you to go to any doctor that accepts Medicare.

    While for some, networks are going to be no problem, if you are someone who wants to possibly visit specialists or travel in retirement, a Medicare Advantage plan is not going to work well. Due to the networks, which are based on your zip code, Advantage plans do not travel well.

    While some Medicare Advantage plans allow you to go out-of-network for an additional cost (PPOs), some plans do not pay for anything at all if you go out-of-network (HMO). This can get very very expensive.

    Make sure to consider the networks before signing up for a Medicare Advantage plan.

  • Medicare Advantage plans are hard to compare
    Medicare Supplements are standardized, Medicare Advantage plans are not. They are going to vary on monthly premiums, deductibles, copayments, drug costs, and extra benefits.

    What is offered is also going to vary greatly by your location. Advantage plans are based on zip code. Some zip codes are going to have 10+ plans, some are going to have none.

    You are also going to want to make sure that all the doctors you absolutely want are going to be in the network of the plan you pick. This means you need to check the network of every single plan you are considering.

    For these reasons, Medicare Advantage plans are really hard to compare.

  • You can only switch Medicare Advantage plans during Annual Enrollment
    With Medicare Supplements, you can change your plan anytime of the year. With Medicare Advantage plans, you can only change your plan one time per year,and only during the annual open enrollment period. This occurs from October 15th – December 7th every year.
  • Plans can change their drug and medical coverage every year
    It is important to shop your options every year because it is highly likely that the plan you are on is going to change.

    Right before annual open enrollment, plans evaluate and change their networks and drug formularies. Many times, your doctor could be moved out-of-network and your drugs could be made more expensive.

    You need to make sure in the fall of every year that everything you need to be covered is going to be.

Even with the cons, we do not want to seem like we are making Medicare Advantage plans out to be bad. Like we said, Advantage plans work really great for many of our clients, but we have to make sure that the limitations of these plans work for their situation.

Make sure to shop around and work with a broker who sells for many companies when looking into Medicare Advantage plans. You need to know all your options to make sure you find the plan that fits the best for your life. 

If you are thinking a Medicare Supplement might be the route for you, you can read more about those plans here.

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