Original Medicare vs. Medicare Advantage: How They Really Differ

If you live in Mooresville, Statesville or anywhere around Lake Norman and you're on Medicare (or about to be), you've probably heard two phrases over and over: Original Medicare and Medicare Advantage. They're the two main ways to get your Medicare benefits, and they work differently. Neither one is right for everyone. The better fit depends on your doctors, your prescriptions, your budget and how you like to get care.

Here's a straightforward look at how they compare, so the choices you see during the Annual Enrollment Period (October 15 to December 7) make more sense.

What Original Medicare is

Original Medicare is the program run by the federal government. It has two parts:

• Part A helps cover hospital stays, skilled nursing facility care, hospice and some home health care.
• Part B helps cover doctor visits, outpatient care, preventive services and medical equipment.

With Original Medicare, you can generally see any doctor or hospital in the country that accepts Medicare. You usually don't need referrals to see a specialist. But Original Medicare doesn't cover everything. There's no yearly limit on what you pay out of pocket, and it doesn't include most prescription drug coverage. Routine dental, vision and hearing care generally aren't covered either.

That's why many people on Original Medicare add a stand-alone Part D drug plan, and some also add a Medicare Supplement (Medigap) policy to help with costs Parts A and B leave behind.

What Medicare Advantage is

Medicare Advantage, sometimes called Part C, is a different way to get your Part A and Part B benefits. Instead of the government paying for your care directly, you get your coverage through a private plan that's approved by Medicare. You still have Medicare, and you generally keep paying your Part B premium.

Many Medicare Advantage plans include prescription drug coverage in the same plan. Some offer extra benefits, like routine dental, vision or hearing coverage, but benefits vary by plan. Every Medicare Advantage plan also has a yearly limit on out-of-pocket costs for covered Part A and Part B services, which Original Medicare doesn't have.

The big differences, side by side

Doctors and networks

This is often the deciding factor. Original Medicare lets you use any provider that accepts Medicare. Most Medicare Advantage plans use a network, such as an HMO or PPO. An HMO usually asks you to use in-network providers and may require referrals. A PPO usually lets you go out of network, often at a higher cost. If you have a doctor in Huntersville or a specialist in Charlotte you don't want to give up, checking networks comes first.

Costs

With Original Medicare, you pay deductibles and coinsurance, and those costs have no annual cap unless you add other coverage. With Medicare Advantage, you typically pay copays or coinsurance as you use care, up to the plan's yearly out-of-pocket maximum. Premiums, copays and limits vary from plan to plan, so it helps to look at your total likely costs, not just the monthly premium.

Prescription drugs

On Original Medicare, drug coverage comes from a separate Part D plan. Many Medicare Advantage plans build drug coverage in. Either way, the details that matter are whether your medications are on the plan's list and which pharmacies are in network.

Travel

If you spend part of the year away from North Carolina, or you travel often to see family, this matters. Original Medicare works the same way anywhere in the U.S. Medicare Advantage networks are usually local or regional, so coverage away from home outside of emergencies may be limited depending on the plan.

Prior authorization

Medicare Advantage plans may require approval before certain services, tests or procedures. Original Medicare generally uses prior authorization less often. It's worth asking how a plan handles this for care you expect to need.

A few questions to ask yourself

• Which doctors, hospitals and pharmacies do I want to keep?
• What prescriptions do I take, and what do they cost me now?
• Would I rather have predictable copays or the freedom to see any provider that accepts Medicare?
• Do I travel or live part of the year outside the area?
• How much could I comfortably pay out of pocket in a year with a lot of care?

Switching later isn't always simple

During the Annual Enrollment Period, you can move from Original Medicare to Medicare Advantage, or back the other way. But if you leave Medicare Advantage and want a Medicare Supplement policy, you may have to answer health questions to qualify, depending on your situation. Rules may vary, so it's smart to understand this before you make a change.

Talk it through with a local broker

I'm Matt MacMillan, a licensed broker based right here in Mooresville. I can walk you through how Original Medicare and Medicare Advantage options in Iredell County and the Lake Norman area compare for your doctors and prescriptions, and there's no fee for my help. You can read more on my Medicare page or the Iredell County Medicare Advantage guide, and if you're new to Medicare, the turning 65 timeline is a good place to start.

When you're ready, call me at (704) 802-2523 or request a call below, and we'll go over your options at your pace.

We do not offer every plan available in your area. Currently we represent 8 organizations which offer 1,210 products in your area. Please contact Medicare.gov, 1-800-MEDICARE, or your local State Health Insurance Program (SHIP) to get information on all of your options. The MacMillan Agency is not connected with or endorsed by the U.S. government or the federal Medicare program. Plan availability, benefits and costs vary by county and plan.