In 2023, the majority of Medicare beneficiaries will be enrolled in a private Medicare Advantage plan, and nearly 7 in 10 beneficiaries will be members in Medicare Advantage by 2030.¹ Medicare Advantage plans differ from traditional Medicare as they are paid on a capitated basis to cover the health care needs of enrollees each year. Medicare Advantage plans may cover additional benefits unavailable in traditional Medicare, such as dental and fitness benefits, and face incentives to coordinate care and reduce health care spending. To lower costs, Medicare Advantage typically constrains the network of available physicians and implements prior authorization requirements. Roughly 1.5% of the nation’s gross domestic product and 5% of the federal budget is spent on payments to Medicare Advantage. With the program’s recent rapid growth, it is imperative to understand the implications of its expansion for patient outcomes and medical spending.

Since almost the inception of the Medicare program, beneficiaries have had the choice of receiving coverage through traditional Medicare or private insurance plans, known today as Medicare Advantage plans. Each year, during Medicare open enrollment, beneficiaries can reassess their coverage options to decide which coverage best meets their health needs and budget. Little research has been conducted to understand how and why beneficiaries make these choices.

Beneficiaries weigh several trade-offs.¹ On the one hand, Medicare Advantage plans typically provide some coverage for benefits not included in traditional Medicare, such as eyeglasses. Plans also have a cap on out-of-pocket expenses for services covered by traditional Medicare, while traditional Medicare does not have a similar limit. On the other hand, traditional Medicare allows beneficiaries to go to any doctor, hospital, or other health care provider that accepts Medicare, without the need for prior approval; Medicare Advantage enrollees typically need a referral from their primary care physician as well as plan approval if they want services from specialists, such as oncologists, covered by the plan.

Historically, most Medicare beneficiaries have chosen to receive their benefits through traditional Medicare,² but enrollment in Medicare Advantage plans has grown rapidly over the past decade. Forty-five percent of Medicare beneficiaries are enrolled in Medicare Advantage plans in 2022, a share that is projected to rise to more than 50 percent by 2025

 Extended benefits were the most common reasons cited for choosing a Medicare Advantage plan. About one in four (24%) Medicare beneficiaries enrolled in a Medicare Advantage plan cited its additional benefits, while one in five (20%) pointed to a limit on out-of-pocket spending as the main reason for their choice. However, that out of pocket expense can grow fast with a cap of  8K a year per perosn. A larger share of people with the lowest incomes (below 100% of the federal poverty level, or FPL) than those with the highest incomes (over 400% of FPL) cited the additional benefits (36% vs. 20%, respectively) and a smaller share of dual-eligible beneficiaries (low-income adults enrolled in both Medicare and Medicaid) cited the out-of-pocket limits (8% vs. 22%, respectively) as their main reason for choosing Medicare Advantage over traditional Medicare.

Greater choice in providers was the reason most frequently given for choosing traditional Medicare. This was true for beneficiaries who supplement their coverage with a private insurance plan as well as those who don’t supplement, although beneficiaries with supplemental coverage cited provider choice as the primary reason at two times the rate of those without it (50% vs. 22%).

A growing number of older Americans are choosing Medicare Advantage plans over traditional Medicare, and beneficiaries are reaching for different sources of information and support to make their coverage decisions. It’s important to learn how these sources inform beneficiaries, whether they are equitably accessible, and what kinds of services and information are needed to fill any gaps. Regardless of where beneficiaries get information for making their coverage decisions, having accurate, easy-to-use tools would help them evaluate their options.

My spouse and I have the Advantage Plan mainly due to lower cost and a few extra benefits that those plans have, however over the years I have noticed that the max out of pocket expense has grown a little, for our plan it is 8K per year per person, and that can add up quickly if both were to get sick, and who can afford to get into medical debt on a fixed income, we certainly cannot.

The problem is when open enrollment rolls around and one has been sick for one reason or another and you try and switch out of the Advantage Plan to Medicare, one must QUALIFY to make the switch and most do not because of one illness or another and they have to stay on their current plan which could cause some money issues when it comes to out of pocket expense.

We like our Advantage Plan but want to be covered just in case of a medical emergency and lessens the out of pocket expense, and we found a company that does just that Impact Health Sharing. 

OPTION FOR ADULTS 65 AND OVER?

Individuals 65 and older with Medicare Parts A and B can be members of Health Sharing. And, with  Health Sharing, you will find a lot of the same things you expect from typical healthcare coverage, and so much more!

No Provider fees.
No Co-share.
No Pre-existing limitations.

Max out of pocket expense 1K per year per person. That is a savings of 15K a year for a couple. Now we have peace of mind when it comes to our Health Coverage and out of pocket expsense. I encourage you to take a close look at the Senior Plan for Impact Health and Get Your Free Quote Today