For Consumers

What is the difference between Original Medicare and Medicare Advantage?

 

Original Medicare
(Part A and B)

Medicare Advantage Plans
(Part C)

Main differenceMedicare pays providers the Medicare-approved rates for covered services per Medicare rules and regulations. Your providers bill Medicare.Medicare pays private health plans that have contracts with Medicare to provide all medically-necessary health care that Original Medicare (Parts A and B) cover. Your providers bill your Medicare Advantage plan.
Costs

You pay Medicare Parts A and B premiums, deductibles and coinsurances.

Part A is free if you or your spouse have paid taxes while working a minimum of 10 years (if not, you may pay a premium). For most people, the Part B cost is $134 in 2018.

You pay Medicare Parts A and B premiums, and your Medicare Advantage Plans premium, if it charges one, and possible deductibles and coinsurances.

Part A is free if you or your spouse have paid taxes while working a minimum of 10 years (if not, you may pay a premium). For most people, the Part B cost is $134 in 2018.

Supplemental insuranceYou may be able to buy a Medigap policy. Other insurance, such as retiree, employer or union plans may supplement Medicare.You can't buy a Medigap policy to help pay your out-of-pocket costs in a Medicare Advantage plan.
Covers extra services like vision and dental?No. Covers medically-necessary inpatient and outpatient health care. Doesn't cover certain services such as routine vision, hearing or dental care.Maybe. May cover some services Original Medicare doesn't cover such as routine vision, hearing and dental care. All plans must cover the same inpatient and outpatient services Original Medicare covers.
Allows me to see providers nationwide?Yes. You can go to any doctor or hospital in the U.S. that accepts Medicare.Usually not. Most people have HMOs, which typically have local networks of providers you must use for the plan to cover your care. PPOs plans should cover care you get outside the network, but you will pay more.
Need referrals to see specialist?No. You don't need a referral.Maybe. You may need to get a referral from your primary care doctor if you want to see a specialist.
Covers drugs?No, but if you want Medicare prescription drug coverage, you can buy a separate Part D plan.Usually. Most plans include Part D drug coverage. You usually can't get a separate Part D plan if you have a Medicare Advantage plan.
Out-of-pocket limits?No. There's no cap on what you spend on health care.Yes. Plans must have an annual out-of-pocket limit, which can be high, but protect you if you need expensive care. The plan pays the full cost of your care after you reach the limit.

Definitions:

  • Premium: The monthly fee you pay to have Medicare or your health plan.
  • Deductible: What you must pay before Medicare or your health plan starts paying for your care.
  • Copayment/coinsurance: Your share of the cost you pay for each service.
  • Part A: Medicare hospital insurance for inpatient care.
  • Part B: Medicare medical insurance for outpatient care.
  • Part D: Medicare drug coverage
  • Medigap: Supplemental insurance that helps pay your out-of-pocket cost in Original Medicare.