What is Medicare Advantage? Offering Value to the Medicare Package

Medicare Advantage plans have received a great deal of media attention in recent years. What is Medicare Advantage? In short, it is a new way to receive Medicare benefits by choosing a private insurer to provide health care services. Medicare Advantage plans offer flexibility and a greater degree of patient choice than traditional Medicare coverage, but may cost considerably more in monthly premiums. This is due to the increased services and benefits provided by the companies as well as additional overhead and administrative costs.

Medicare Advantage plans were created through the Balanced Budget Act of 1997, which included language offering Medicare beneficiaries the choice of continuing to receive government-administrated benefits or applying their earned Medicare benefits to private health insurance options. At that time, the plans were referred to as Medicare + Choice plans, or simply Part C plans. After the passage of the Medicare Prescription Drug, Improvement, and Modernization Act in 2003 the name was officially changed. These insurance options are now referred to as Medicare Advantage plans, although many documents still refer to them as Medicare Part C plans as well.

Medicare Advantage coverage is required by law to be as good as or better than the coverage provided by traditional Medicare plans. In order to provide Medicare Advantage plan coverage, the company must include all benefits provided by Medicare Part A and B plans, but is not required to provide those benefits in precisely the same way. While Medicare Advantage plans usually cost more than comparable Part B coverage from Medicare, they almost always provide better value to the consumer by offering additional services and providing more comprehensive benefits for typical health care expenses. This has led to increased enrollment in Medicare Advantage in recent years; the number of enrollees has nearly doubled since 2005 and now stands at approximately twenty percent of all Medicare recipients.

So, what is Medicare Advantage? For many, it is a way to reduce health care expenses while maintaining their health through regular medical treatment. Medicare Advantage plans vary widely, so consumers are advised to compare plans, benefits, and premiums in order to determine which plan works best in their particular situations.