Medicare Advantage plans, also known as Medicare Part C, were implemented by the federal government in 2003 to provide an alternative to Medicare Part A and B. They allow the insured to choose an insurance company on the private market, which can give them more flexibility in coverages and could also result in a lower premium. However, there are some disadvantages to choosing a Medicare Advantage plan.
Variety of Plans
As opposed to regular Medicare, which provides standard coverages, Medicare Advantage offers as many as 50 different plans. This can create confusion, and seniors have to rely on the salesperson to provide them with complete and accurate information. Otherwise, they could be left without coverage for things they thought were included in the plan.
Increased Taxpayer Expense
There is evidence that shows Medicare Advantage plans may cost the taxpayers more money than traditional Medicare coverage. According to CBSNews,com, three independent studies have found that private companies are paid from 12 to 50 percent more than what it costs the federal government to operate Medicare.
Out of Network Costs
Since Medicare Advantage plans typically require the insured to belong to a network to obtain coverage, there may be a substantial cost if the insured decides the go outside the network for treatment. This same often applies if the insured wants to see a specialist that is not referred by a primary care physician.
Reduced Coverage Area
Many plans restrict coverage to certain geographic areas. Thus, if the insured are frequently travelers, they find themselves without coverage for injuries or illness incurred while traveling or on vacation. If it is a non-emergency situation, they may be required to foot the entire bill themselves.
Termination of Coverage
Unlike traditional Medicare, there is no guarantee that coverage will continue for the insured. If a Medicare Advantage insurer finds it is not making a profit in a given area, it may pull out of the area, which leaves the insured without coverage. Other coverage options are available, but the process can be stressful and there is no guarantee that all the same types of coverages can be obtained.
