Original Medicare provides insurance for hospital, nursing home, and hospice expenses (Part A) and for covered expenses of doctors, outpatient services, and durable medical equipment (Part B). It is a fee-for-service program where people can choose care from providers anywhere in the U.S. who accept Medicare. Claims are managed by private Medicare administrative contractors who oversee the program in different parts of the country.
Most of the people with original Medicare also get a stand-alone Part D prescription drug plans from private insurance companies.
Part B pays only 80 percent of covered expenses. About 10 million people with original Medicare buy private Medigap insurance plans that help pay such uncovered expenses. There are different plans that cover different amounts of what original Medicare does not fully pay.
If you do want original Medicare, use Medicare’s Medigap online policy search tool to identify attractive plans and then make sure to call them and find out what they would charge you. Here is Medicare’s useful guide to Medigap.
Medicare Advantage plans must cover everything that original Medicare covers but are also allowed to cover additional health needs – dental, vision, hearing, fitness-plan memberships and a growing range of non-medical health expenses. These will include transportation to medical appointments, at-home meals for people recently released from hospitals, and home-safety improvements such as bathroom grab bars.
Most plans include Part D drug coverage and have annual out-of-pocket spending limits, thus providing protection similar to Medigap plans. Enrollees thus can deal with one insurance company for all their Medicare claims, whereas they need to deal with separate companies for original Medicare, Part D drugs, and Medigap claims.
Among the potential downside of Medicare Advantage plans is the requirement that customers use the services of doctors, hospitals, and other health providers included in a plan’s provider network. These networks usually allow plans to save money for themselves and consumers. But they also restrict consumer choice compared to original Medicare.
The bottom line here is “buyer beware.” Don’t make a Medicare Advantage enrollment decision based on what an insurance company’s provider directory is telling you. Call the offices of your preferred doctors and other providers and confirm the identities of their Medicare Advantage partners.