If you're enrolled in a Medicare Advantage plan, you may be wondering if the plan will cover the 20% coinsurance you'd normally pay under Original Medicare Part B. Understanding how Medicare Advantage handles Part B premium costs is important to know what you'll pay out-of-pocket.
Medicare Part B covers medical services like doctor visits, lab tests, surgeries, and preventive care. Under Original Medicare, you typically pay 20% of the Medicare-approved amount for Part B services after you meet your annual Part B deductible. But with Medicare Advantage, the rules can work differently.
Below we’ll explain how Medicare Advantage plans handle Part B coinsurance and what costs you may be responsible for. Read on to learn whether Medicare Advantage plans pay the 20% coinsurance for Part B services.
Do Medicare Advantage Plans Pay the Part B Coinsurance?
Medicare Advantage plans are required to cover all medically necessary services that Original Medicare covers. This includes covering Part B services like doctor visits, outpatient care, lab tests, preventive care, and more.
However, Medicare Advantage plans aren't required to cover the Part B coinsurance in the same way as Original Medicare. Here are a few key points on how Medicare Advantage handles the Part B coinsurance:
Many Medicare Advantage plans do not charge a 20% coinsurance for Part B services. Instead, they often charge fixed dollar copays for visits and services.
Some plans may charge coinsurance for certain services, but it may be less than 20% or have an out-of-pocket limit.
Medicare Advantage plans have an annual out-of-pocket maximum that limits your total costs for medicare Part A and part B services each year. In 2023, this limit is $8,300.
Once you hit your plan's out-of-pocket limit, the plan pays 100% of your Part A and B costs for the rest of the year.
So in summary, Medicare Advantage plans aren't required to charge the 20% Part B coinsurance like Original Medicare coverage does. Many plans cover your Part B services with fixed copays instead. And all plans limit your total out-of-pocket costs for Part A and B services each year.
Medicare Advantage Plan Copays for Part B Services
Rather than a percentage coinsurance, most Medicare Advantage plans offer or charge a copay for Part B services like doctor office visits, lab tests or outpatient procedures. These copays often range from $0 to $50 depending on the service and plan.
For example, a Medicare Advantage HMO may charge:
$10 copay to see a primary care doctor
$35 copay to see a specialist
$15 copay for lab services
$250 copay for outpatient surgery
Copays for Part B services will vary between different Medicare Advantage plans and insurance providers. Comparing copays can help you find a plan with coverage that fits your healthcare needs and budget.
Some Medicare Advantage plans don't charge any copay for certain services like lab work or preventive care exams. Other plans may charge coinsurance for some services, but there is always a maximum out-of-pocket limit.
Out-of-Pocket Limits Protect You From High Costs
All Medicare Advantage plans have an annual out-of-pocket maximum that limits your costs for Part A and B covered services. In 2023, the maximum out-of-pocket limit is $8,300.
This protects you from open-ended 20% Medicare Part B coinsurance costs under Original Medicare. Once you reach your plan's out-of-pocket limit, you'll pay nothing for covered Part A and Part B services for the remainder of the year.
Some Medicare Advantage plans have lower out-of-pocket maximums like $5,900 or even $3,400 that provide more cost protection. Plans with lower out-of-pocket limits often have higher premiums.
Always check the plan's out-of-pocket limit when evaluating different Medicare Advantage options according to centers for medicare. The out-of-pocket max puts a cap on the total amounts you'd pay for covered medical services during the year.
What Costs Count Towards the Out-of-Pocket Limit?
The following out-of-pocket costs count towards your Medicare Advantage plan's annual limit:
Copays and coinsurance you pay for Part A and Part B covered services
Your Medicare Part B deductible (if your plan has one)
Your Medicare Advantage plan's deductible (if it has one)
Any costs you pay during the deductible phase of your plan
The following costs do not count towards the out-of-pocket limit:
Your monthly premium
Costs for prescription drugs (covered under Part D)
Costs for dental, vision, or hearing services (if offered by your plan as extra benefits)
Any amount you pay above the plan allowed cost when using an out-of-network provider
Always check with your specific Medicare Advantage plan to understand what benefits are covered and which costs count towards your out-of-pocket maximum. This can help you estimate what you'll pay for healthcare in a year.
Should You Buy Supplemental Insurance?
While Medicare Advantage plans limit your out-of-pocket costs, you may want to consider purchasing supplemental coverage like a Medigap policy for additional protection:
Original Medicare supplement (Medigap) plans help pay costs like coinsurance, copays, and deductibles. But you can't pair a Medigap plan with Medicare Advantage - only with Original Medicare.
Many Medicare Advantage plans don't include dental, vision, or hearing coverage. Supplemental plans can help fill these gaps.
Critical Illness or Cancer Plans
These provide lump-sum cash benefits if diagnosed with a critical illness that you can use for medical costs or daily expenses.
For many, the out-of-pocket limit protection from Medicare Advantage gives enough coverage on its own. But supplemental plans provide an extra layer of financial protection for vulnerable seniors.
While Original Medicare covers 80% of Part B costs, Medicare Advantage plans are not required to charge 20% coinsurance for Part B services. Key takeaways include:
Medicare Advantage plans often charge copays rather than 20% coinsurance for Part B services.
All Medicare Advantage plans limit your annual out-of-pocket costs for Part A and B services.
Once you hit your plan's out-of-pocket limit, you'll pay $0 for covered services.
Supplemental insurance provides extra financial protection not covered by Medicare Advantage.
Understanding how Medicare Advantage handles Part B costs can help you choose a plan that provides the right healthcare coverage and financial protection. Always consider the full costs when evaluating different Medicare Advantage plans and options.
We’re Here to Help
You do not have to spend hours reading articles on the internet to get answers to your Medicare questions. Give the licensed insurance agents at Bourgeois Insurance a Call at (985) 803-8999. You will get the answers you seek in a matter of minutes, with no pressure and no sales pitch. We are truly here to help.
What is Medicare Part C?
Medicare Part C refers to Medicare Advantage plans. These private insurance plans are an alternative to original Medicare and cover everything Part A and Part B cover. Most Medicare Advantage plans also include Part D drug coverage.
What benefits do Medicare Advantage plans have to cover?
Medicare Advantage plans must cover all services Original Medicare covers. Many plans also offer extra benefits like dental, vision, hearing, and fitness benefits that traditional Medicare does not cover.
Do Medicare Advantage plans have an out-of-pocket maximum?
Yes, Medicare imposes a yearly limit on out-of-pocket costs for in-network care. In 2023, plans can't charge more than $8,300 as the maximum out-of-pocket limit for covered medical services.
How do Medicare Advantage plans help coordinate care?
Many Medicare Advantage plans have care management teams that help coordinate care between different doctors, specialists, and health facilities. This helps ensure patients get the services they need.
Who can enroll in a Medicare Advantage plan?
To enroll in Medicare Advantage, you must be enrolled in original Medicare Parts A and B and live in the plan's service area. Most Medicare beneficiaries are eligible to join a Medicare Advantage plan.
Are prescription drugs covered by Medicare Advantage plans?
Yes, nearly all Medicare Advantage plans include Medicare Part D prescription drug coverage with the medical benefits, usually for an extra premium. With original Medicare program, you need a separate Part D plan.
What types of Medicare Advantage plans are available?
The main types include HMOs, PPOs, private fee-for-service plans and Special Needs Plans. Availability varies by location. Each plan has different networks, costs, and coverage rules.
Can I use Medicare supplement insurance with Medicare Advantage?
No, Medigap policies only supplement original Medicare costs. Medicare Advantage plans have set out-of-pocket limits, so a Medigap is not needed.
When can I enroll in or change Medicare Advantage plans?
The Medicare annual election period from October 15 to December 7 allows you to enroll in or switch Medicare Advantage plans for the following year. There are also special enrollment periods.
Where can I compare Medicare Advantage plans?Use the Medicare Plan Finder tool on Medicare.gov to compare Medicare Advantage plan benefits, costs, ratings and coverage details. You can enroll online or work with a licensed insurance agent.
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