The Real Costs of Medicare Advantage

When you're looking at Medicare Advantage, the first thing you usually see is a $0 premium. It looks like a free pass, but insurance is never free. The real choice you're making isn't between a supplement and an Advantage plan - it's between Traditional Medicare (Parts A and B) and the Medicare Advantage path.

If you choose the Advantage path, you are agreeing to a different cost structure. Instead of paying a higher monthly premium for a supplement that covers your bills, you pay as you go. You'll have copays for doctor visits, coinsurance for procedures, and deductibles for certain services.

Here is how the costs break down on a typical Medicare Advantage plan:

• Monthly Premium: Often $0, but you must continue paying your Part B premium [as of 2024, varies by location and age].
• Deductibles: Some plans have a medical deductible you must meet before they pay.
• Copays and Coinsurance: You pay a set amount or percentage for each service. A specialist visit might be a $45 copay; a hospital stay might be $295 per day for the first five days.
• Maximum Out-of-Pocket (MOOP): This is your safety net. By law, Advantage plans must cap your annual out-of-pocket spending for covered medical services. Once you hit this limit, the plan pays 100% for the rest of the year.

The paper promises of a $0 premium are appealing, but you have to look at the total potential cost. If you have a major health event, you could easily hit that out-of-pocket maximum. That's the trade-off. You save on monthly premiums, but you take on more risk if you get sick.

We're on your side of the table. We don't push one path over the other. We want you to understand the costs so you can make the right decision for your money and your health. If you're ready to look at the numbers, we can walk you through every option.