Is There Such a Thing as Free Medicare Advantage Plans?

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When you turn 65, it will be time to decide whether to enroll in regular Medicare or a Medicare Advantage Plan. You may already know that Medicare Advantage plans offer more services, and you may be aware that some Advantage plans claim to be free. Before you decide, here are some things you need to know.

Medical insurance companies—as well as any insurance company—exist to make a profit. With medical costs as high as they are today (and you can expect them to keep rising), any insurance company not making a profit will not stay in business very long. It means that somehow they will make a profit from you.

The Services Medicare Advantage Plans Offer

One reason that Medicare Advantage plans have become so popular and continue to grow in popularity is because of the extra services. Medicare insurance does not provide dental, eyeglasses, hearing, or wellness plans, but many Advantage plans will. Since people going on Medicare are 65 or older, these extras are something that most seniors want.

The Government’s Part

Around the time you turn 65, if you are employed, you need to enroll in Medicare. Traditional Medicare offers parts A (which is free if you qualify), B, D, and some supplemental parts. Medicare Part C coverage is the advantage plan, and it combines parts A, B, and D.

Once you enroll, you will pay the standard Medicare cost for Part B, which for 2023 is $164.90 per month. People with high incomes pay more for their Medicare services. CNET says the projected cost will increase to $174.80 per month in 2024.

Enrolling in a Medicare Advantage Plan may or may not mean you are going to pay any additional fees for the policy. The government subsidizes Medicare plans with so much per month. Still, ValuePenguin says that you may pay up to an additional $266 per month for your Medicare Part C cost. Many people can get Medicare Part C coverage for $0 above the $164.90—depending on your company, the provider, and the plan. HMO Medicare Advantage plans average an additional $20 per month, which is the cheapest.

Pre-Existing Conditions

A Medicare policy requires that you buy Medigap when you want additional care. An Advantage plan cannot reject you if you have a pre-existing condition. You could face rejection for a pre-existing condition, Fortune says, if you switch from a Medicare Advantage plan to an original Medicare plan and try to buy Medigap. Most states may reject your application for Medigap because of a pre-existing condition.

Things to Consider With $0 Cost Plans

If you have a Medicare Advantage Plan that claims to be free, you can be sure that you will be paying something somehow. Most likely, it will be in the co-pays and co-insurance costs. They are apt to be higher than other companies, and the total annual out-of-pocket costs will be higher.

• Deductible Costs

Even though the Advantage Plan may cost you more than traditional Medicare premiums, there are some ways it will cost less. If you have considerable health problems, you may visit the doctor and specialists more often. Forbes mentions that Medicare costs for staying in-network have a maximum out-of-pocket cost of $8,300. Total costs for medical services in and out of the network have a ceiling of $12,450.

Medicare Advantage plans, on average, are just $4,835 when using only in-network medical care. The average total for a combination of in- and out-of-network costs is just $8,659. eHealth says that your out-of-pocket costs could change annually and will vary between companies.

• Limited Specialists

A Medicare Advantage Plan may have limited doctors and specialists in your area. It could force you to go out-of-network often, depending on what specialized care you need. People with chronic health conditions should consider this before buying a health plan. Your Advantage company may offer special meeds plans (SNPs), which could help reduce your costs for long-term treatment.

• Drug Costs

Regular Medicare requires you to buy Part D if you want drug coverage. A Medicare Advantage plan includes Part D, which will likely be free. You can expect a copayment with some medicines—especially if they are brand names. Coverage will vary from one year to the next, possibly requiring different copays from one year to the next. Also, new medicines are added each year.

• Coverage May Be State-Specific

A standard Medicare policy ensures access to medical coverage across the United States. HealthLine says that Medicare Advantage plans are state-specific, and if you move out of state, you may no longer be covered.

The Best Medicare Advantage Plans

Finding your best Medicare Advantage plans will take a little effort. You need to look at the details of what the plan covers, the cost, the co-pays, and the ceiling for out-of-pocket expenses. Take time to look for coverage if you need specialized care and determine if there are specialists near you that accept your plan. If you have a doctor you like, check to see if they are in the Advantage plan you are considering.

Although some Medicare Advantage plans claim to be free, you still must pay the monthly premium for Part B. Other than that, the only way it is completely free is if you are very healthy and do not use any medical services.

The enrollment period to sign up for Medicare or Medicare Advantage plans is coming soon. You can enroll in either plan or change plans from Oct. 15 through Dec. 7. Remember that you must enroll in Medicare within three months of either side of your 65th birthday. NerdWallet says that if you miss the enrollment period, you can still enroll from Jan. 1 to Mar. 31. Coverage starts one month after signing up, but you may have to pay late fees.

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