Should you join a Medicare Advantage plan?

You are eligible for Medicare. Now what? You have some choices to make. Insuring yourself with Medicare is an option, but it will be subject to some potentially high unpredictable costs. Or you could buy a Medicare supplement, if it’s affordable. Your third option is to join a Medicare Advantage Plan.

Enrolling in this type of Medicare plan is a popular choice for many people for a number of reasons. But it is not the best option for everyone. Who joins a Medicare Advantage Plan is largely determined by individual circumstances. And don’t expect to find a plan that is necessarily considered best for everyone. You may want to consider an Advantage plan if you meet any of the following criteria.

you have a limited budget

Having a limited budget comes into play in two ways. First, you may want to consider signing up because you’ll receive all the benefits of Original Medicare, but you’ll have the benefit of a maximum out-of-pocket amount. If you get your coverage through Original Medicare, there will be no cap on your share of the costs of covered services. Just 20% of outpatient costs could leave you with some budget expenses.

Another reason your limited budget might draw you to a plan is the high cost of Medicare supplement premiums. Supplemental premiums are typically much higher on average than premiums for Medicare Advantage plans. Some Advantage Plans have premiums as low as $0 per month.

You want extra benefits

Medicare Advantage plans include all the benefits of Part A and Part B, but the private insurance companies that offer these plans may include benefits beyond what would normally be available in original Medicare.

It is common for plans to include Part D drug coverage and some plans may include extras such as; dental, vision, hearing, gym memberships and transportation. Medicare supplement policies rarely include these extras, and supplement policies are not currently offered with drug coverage built in.

You want an all-inclusive plan

If you want a plan that includes your Part D drug and medical benefits, you should consider an Advantage plan. If you join a Medicare Advantage Plan with drug benefits (MAPD), you will only interact with one insurance company, which may limit interaction with multiple member services departments.

You may not qualify for a Medicare supplement

Unless you are in your Medigap Open Enrollment Period or entitled to Guaranteed Issue Rights, you will generally be subject to medical underwriting when you purchase a Medicare supplement. Some pre-existing conditions or recent hospitalizations could result in a denial of coverage.

Some states do not require insurance companies to offer Medicare supplemental coverage to Medicare beneficiaries under age 65. And in those states that do, premiums can be much higher for beneficiaries under 65.

Those are some of the reasons you may want to join a Medicare Advantage plan. And for some people, it’s the only option besides Original Medicare.