Medicare has provided affordable healthcare coverage for individual over the age of 65 since 1965. Over the years, the program has been amended to offer a number of different types of plans to serve the needs of this population. The program is divided into two main categories, Original and Advantage plans. There are a number of advantages and disadvantages to each type of coverage. Here are a few details of each type to help you determine the right plan for your health needs:
A Variety of Coverage Choices
The Original plan operated for many years to cover the healthcare costs of older Americans. In an effort to contain costs under the program, the Advantage plan system was implemented, which involves health insurance companies that serve to contain costs by working with networks of providers that agree to certain service payments. The Advantage plan, also called Part C, offers a wide range of HMO and preferred provider plans. Plans may also cover dental, hearing and vision care. Some plans are at additional cost, but others are fully covered under the Medicare program. In addition, you can choose to acquire an additional Medicare plan that will cover prescription drug expenses, under Part D coverage. Although all these choices may seem confusing, a closer look at the advantages and disadvantages of each type of plan can help you decide the best option for your needs.
Advantages of Original Medicare
The Original plan has two parts, Part A that covers hospital admission, and Part B that covers doctors, outpatient services, laboratory, preventative care and medical equipment. Generally, all individuals enrolled in healthcare coverage for older individuals pay nothing for Part A coverage. Part B coverage starts at $148.50 per month as of 2021, but Part B can be higher in cost depending on your income. The advantage of Original Medicare is, you do not have to pay an additional monthly premiums to a health insurance company. Both Part A and Part B services are covered. Another advantage is that many doctors and healthcare providers accept Original Medicare as payment for services. The Original plan will also cover you as you travel anywhere in the U.S.
Disadvantages of Original Medicare
The main disadvantage of the Original plan is that there can be considerable out-of-pocket costs to this program. Even after meeting the deductible on Part A, which is $1484.00 as of 2021 and that of Part B, which is $203.00 as of 2021, you will still be responsible for a number of co-pays and co-insurance. In addition, Part B will only cover 80 percent of the costs, which leaves the patient to pay the remaining 20 percent. The Original plan also does not cover vision, hearing or dental care.
Advantages of Part C Plans
The Advantage plans have become very popular among those enrolled because they offer a number of significant benefits. They generally have a wide range of physicians and facilities in their networks as stated by ClearMatch Medicare. Co-pays and co-insurance payments are generally minimal. Part C will cover most prescription drugs, within certain guidelines. Part C plans often cover vision care, dental care and hearing aids. They may even cover fitness club memberships. Some plans have additional benefits. Annual out-of-pocket costs are limited to a certain pre-determined amount, so the individuals knows how much they are expected to pay for medical expenses during the year. Any amount over this is covered by the health insurance plan.
Disadvantages of Part C Plans
Advantage Part C plans function much like a health maintenance organization plan or a preferred provider plan. It may not cover services outside of your network of doctors or health facilities. Some plans have significant deductibles or co-pays. You often have to call in to get pre-approved for health services in advance of receiving them. You may have to pay a monthly premium for some plans. Part C may pay for only a portion of the cost of your medications, with different classifications of drugs requiring more cost to the patient. Part C generally will not cover costs if you travel outside of the plan coverage area, unless it is an emergency situation. If you move to a location outside the coverage area, you will have to change plans.
Choosing one or the other type of plan can often depend on how much money you are willing to contribute to your healthcare costs and how much outside approval you are willing to comply with when receiving healthcare services. If you choose one type of plan, you are not committed to it permanently. The Medicare system provides for a period of the year during which you can change your plan if you find your needs have changed. You can use this period to choose another plan without penalty. In this way, the program allows you to find the best coverage for your current healthcare needs.