How to Compare Medicare Advantage Plans (2024)

A Medicare Advantage plan, also called Part C, is a Medicare-approved plan. Private companies offer them as an alternative to Original Medicare. Part C plans usually include Medicare Part A (hospitalization coverage), Part B (medical insurance coverage), and Part D (prescription drug coverage). Medicare Advantage Plans may also include additional benefits such as dental, vision, and hearing services.

People who are already enrolled in Medicare Part A and Part B typically enroll in a Medicare Advantage plan for more comprehensive coverage.^[1]

Several different Medicare Advantage plan types are available, and premium costs, prescription drug coverage, and out-of-network restrictions vary between these plans. Comparing several plans is the best way to find the Medicare Advantage option that’s right for your needs.

Here’s what else you need to know about Medicare Advantage plans.

How Medicare Advantage plans work

Private insurers sell Medicare Advantage plans, which can be a useful way for you to enhance your Medicare coverage. When you enroll in a Medicare Advantage plan, Medicare will pay your plan provider a fixed amount each month to support your coverage.

Each Medicare Advantage plan must follow Medicare rules, but the provider can determine your out-of-pocket costs, the network of doctors covered under the plan, and whether you need referrals for specialized care.

Your Medicare Advantage provider can also change these things every year. That’s why it’s important to review your policy annually to make sure your primary care physician is still in your network and you don’t need additional coverage.

Likewise, you also have the option to change your plan every year if you find your current provider no longer meets your needs. You also have the option to drop your Medicare Advantage plan altogether and return to Original Medicare if you so choose.

How to compare Medicare Advantage plans

Finding the right plan for you involves learning about each plan, comparing available coverage options, understanding which plans include premiums, and determining which meets your healthcare needs.

Below is a more detailed look at each step.

1. Research the different plans

First, compare the different types of Medicare Advantage plans. Individual plan types may require monthly premiums, exclude Medicare Part D prescription drug coverage, or require primary care provider referrals for further treatment. Here’s a closer look at the plan types you’ll want to consider.

Health maintenance organization (HMO) plans

An HMO is a type of Medicare Advantage plan (Part C). Private insurance companies offer HMOs.^[2] Some point-of-service HMOs allow out-of-network healthcare services at a higher cost, but most require in-network treatment. You pay a plan premium plus a Part B premium with an HMO. HMO plans normally cover prescription drugs.

Preferred provider organization (PPO) plans

A PPO is similar to an HMO. Both are Medicare Advantage plans offered by private insurance companies. Both also charge premiums and work with a specific network of healthcare practices.^[3] PPO plans allow out-of-network healthcare providers for covered services, though these out-of-network services usually cost more money.

Private fee-for-service (PFFS) plans

A PFFS plan isn’t the same as an Original Medicare plan. Some PFFS plans have networks and prescription drug coverage; others don’t.^[4] A PFFS plan allows you to receive services from any Medicare-approved provider as long as the provider hasn’t opted out of Part A and Part B coverage.

Special needs plans (SNPs)

SNPs have eligibility requirements because these plans cover specific healthcare needs. A person with a chronic condition can enroll in an SNP in addition to their Original Medicare plan. The SNP’s benefits may include extra coverage for services that extend beyond their Medicare coverage, like longer hospital stays for example.^[5]

Medical savings account (MSA) plans

An MSA plan is similar to a health savings account because you get to choose your healthcare services and your provider.^[6] The Medicare MSA is a consumer-directed Medicare Part C plan that features a high-deductible health plan and medical savings account.

2. Use the Medicare Plan Finder

Now that you’re familiar with the available Medicare coverage options, you can find the right plan for you using the Medicare website. You can access this site without an account by entering your ZIP code and selecting the type of plan you’re interested in. You can also specify any additional aid you receive for your healthcare costs and if you want to view drug costs when comparing plans.

The system will then display a list of individual plans available in your area, including the monthly premium, copays, and benefits of each plan. Each plan also shows a Medicare rating of one to five stars, with five stars being reserved for the highest-ranking plans.

3. Consider your needs and budget

As you age, you need a healthcare plan that aligns with your budget and specific medical care needs. This is particularly true for your Medicare Advantage plan. So, as you begin your search, compare these key components among all the plans you research.

Coverage options

When comparing your Medicare coverage options, consider how well a plan covers the services you need and how that plan will work with the other types of health or prescription drug coverage you require.

For example, an Original Medicare plan doesn’t cover benefits like dental or eye exams, while a Medicare Advantage plan does cover dental or vision services. But an Original Medicare plan lets you purchase Medigap coverage, while a Medicare Advantage plan doesn’t.

Cost

Most Medicare Advantage plans charge a premium in addition to the monthly Part B premium you’ll pay for Original Medicare. But a Medicare MSA typically doesn’t have a premium.

These premiums can add up, and you should also remember to compare deductibles, your costs for hospital stays and doctor visits, and other coverage cost considerations you’ll be responsible for paying.

Out-of-network charges

Most HMO plans require you to stay in-network when receiving routine services. PPOs also have a network but allow you to go out-of-network if you’re willing to pay a higher cost. A PFFS plan lets you receive services from any provider that accepts the plan’s payment terms.

It’s also important to note that MSA, PPO, and PFFS plans don’t have referral requirements for specialist care. But HMOs and SNPs that are HMOs do have referral requirements.

Prescription drug coverage

Most HMO, PPO, and PFFS Medicare Advantage plans include prescription drug coverage, and SNPs must always provide Medicare Part D coverage. But MSAs don’t include prescription drug coverage, meaning you’ll have to purchase a separate Medicare drug plan.

Each unique plan has a list of drugs it covers, called a formulary. It’s important to review the formulary of any plan you’re interested in to ensure it covers your prescriptions.

Lastly, don’t put off prescription drug coverage. Delaying enrollment in a Medicare drug coverage plan, once you’re eligible, exposes you to a 1% per month penalty for every month that passes after your Part D enrollment window.

4. Compare Medicare Advantage plans

You should research the benefits and disadvantages of any Medicare Advantage plan you’re interested in, including the different plan type combinations. Look at the plan provider’s rating as well; not only do the Centers for Medicare & Medicaid Services assign plan star ratings, but J.D. Power also surveys customers about their satisfaction with a given plan.

Ask your healthcare provider to recommend a Medicare Advantage plan that makes sense for your budget and healthcare needs. You may need a Medicare Supplement plan now but require a more comprehensive plan in the future if you have a chronic condition.

5. Enroll in a plan

You can enroll in a Medicare Advantage plan three ways: over the phone, online, or with a Medicare Advantage plan agent. The initial enrollment period (IEP) is a seven-month period when you first become eligible for Medicare. This window is only for first-time Medicare members.

If you don’t sign up when you’re first eligible, you can enroll during the general enrollment period (GEP), which takes place between Jan. 1 and March 31 each year. During this time, you can also change your Medicare Advantage plan type if you’re already enrolled in a plan.

Lastly, the autumn open enrollment period is from Oct. 15 through Dec. 7. This period allows you to switch Medicare Advantage plans or switch between MA plans and Original Medicare if you find that doing so better matches your coverage needs.

Comparing Medicare Advantage plans FAQs