What Is a Medicare Advantage Plan?
Medicare Advantage (Part C) is an alternative to Original Medicare offered by private insurers approved by the federal government — often with lower out-of-pocket costs, added benefits, and built-in drug coverage.
Reviewed annually
Based on CMS guidelines
How Medicare Advantage works
When you enroll in a Medicare Advantage plan, you still have Medicare — but your coverage is delivered through a private insurer rather than the federal government. That insurer receives a set payment from Medicare each month to cover your care.
- Most plans include Part D prescription drug coverage — no separate plan needed
- Many add benefits Original Medicare doesn’t cover, like dental, vision, hearing, and OTC allowances
- Plans use networks (HMO or PPO) and typically charge copays or deductibles per service
- Every plan must cap your annual out-of-pocket costs — Original Medicare has no such limit
- You continue to pay your Part B premium even while enrolled
Types of Medicare Advantage plans
Plans vary in how they structure your access to providers and how costs are shared. Here’s a quick breakdown of the most common types.
HMO
Health Maintenance Organization
Requires in-network providers (except emergencies) and often needs a primary care doctor plus referrals for specialists. Typically the lowest-cost option. Some HMOs offer a Point-of-Service (HMOPOS) option that allows limited out-of-network care at a higher cost.
PPO
Preferred Provider Organization
Uses a network but allows out-of-network care at a higher cost-share. No primary care or referral requirements. Some PPOs offer nationwide coverage.
PFFS
Private Fee-for-Service
No fixed network — any Medicare provider that accepts the plan’s terms can treat you. Always confirm a provider accepts your specific plan before your visit. Some PFFS plans allow “balance billing” of up to 15% above the Medicare-approved amount.
SNP
Special Needs Plans
Tailored for people with specific chronic conditions (like diabetes, dementia, or cancer), dual Medicare/Medicaid enrollees, or those in institutional care. All SNPs must include Part D drug coverage.
MSA
Medical Savings Account
Pairs a high-deductible Medicare Advantage plan with a savings account the plan funds. You use that account to pay for care until you meet the deductible. Best suited to people who are generally healthy and want flexibility in how they spend healthcare dollars. Note: MSA plans do not include Part D drug coverage — you’ll need a separate Medicare drug plan.
Medicare Advantage vs. Original Medicare
Both cover hospital and outpatient care, but they differ significantly in structure, costs, and what’s included.
| Feature | Original Medicare (A & B) | Medicare Advantage (Part C) |
|---|---|---|
| Administered by | Federal government | Private insurer (federally approved) |
| Out-of-pocket maximum | No annual limit | Yes — required by law |
| Drug coverage (Part D) | Separate plan required | Usually included |
| Dental / vision / hearing | Not covered | Often included |
| Provider access | Any Medicare provider nationwide | Usually network-based |
| Cost structure | 20% coinsurance after deductible | Copays per visit; varies by plan |
| Referrals needed | No | Depends on plan type |
| Prior authorization | Not required for most services | May be required before certain services are covered |
| Can you add Medigap? | Yes — Medigap works alongside Original Medicare | No — it is illegal to sell you Medigap while enrolled in MA |
Medicare Advantage vs. Medigap (Medicare Supplement)
These two approaches solve different problems. Medigap doesn’t replace Original Medicare — it works alongside it to fill cost gaps. Medicare Advantage replaces it entirely.
| Feature | Medigap | Medicare Advantage |
|---|---|---|
| Works with | Original Medicare (keeps red card) | Replaces Original Medicare |
| Drug coverage | Not included — separate Part D needed | Usually included |
| Provider flexibility | Any Medicare provider — nationwide | Mostly network-based |
| International coverage | Some plans cover urgent care abroad | Generally not covered |
| Monthly premium | Usually higher | Often lower (some $0) |
| Predictability of costs | Very predictable — fills Medicare gaps | Varies by services used |
How to choose a Medicare Advantage plan
Most areas offer multiple competing plans. Use these factors to compare them side by side — ideally with a licensed Medicare broker who can access all available options in your zip code.
-
1
Check your doctors and pharmacies are in-network. For HMOs and PPOs, confirm your preferred providers participate before enrolling. For PFFS plans, ask providers directly if they’ll accept the plan.
-
2
Review the drug formulary. Each plan covers a different list of prescriptions at different cost tiers. Confirm your current medications are covered and at what cost.
-
3
Compare total costs — not just the premium. A $0-premium plan may have higher copays for services you use often. Factor in your expected utilization.
-
4
Look at Medicare’s star ratings. CMS rates plans 1–5 stars annually on quality and service. Prioritize plans rated 4 stars or above.
-
5
Consider your travel habits. If you split time between states or travel frequently, a plan with a national network — or a Medigap plan — may serve you better than a local HMO.
How to enroll
You can enroll in Medicare Advantage during specific enrollment windows. Your plan won’t activate immediately — the coverage begins on the plan’s effective date.
Initial Enrollment Period
A 7-month window around your 65th birthday. The best time to enroll and avoid penalties.
Annual Open Enrollment
October 15 – December 7 each year. Anyone with Medicare can join, switch, or drop a Medicare Advantage plan. Coverage begins January 1.
Medicare Advantage Open Enrollment
January 1 – March 31 each year. Only for people already in a Medicare Advantage plan — you can switch plans or return to Original Medicare.
Special Enrollment Period
Triggered by qualifying events — moving, losing coverage, or plan discontinuation — outside regular windows.
Switching plans is simple: Enroll in a new plan during an enrollment period, and your old coverage ends automatically on the new plan’s effective date. Don’t cancel prior coverage early.
Annual Notice of Change: Every year by September 30, your plan must notify you of any changes to costs, coverage, or networks taking effect January 1. Review this notice carefully — plans can change significantly from year to year. Open Enrollment (Oct 15 – Dec 7) is your opportunity to switch if the changes don’t work for you.
Important things to know before you enroll
Prior authorization can delay or deny care
Unlike Original Medicare, many Medicare Advantage plans require you to get approval before they’ll cover certain services, procedures, or specialist visits. If your plan denies a request, you have the right to appeal. This is one of the most common reasons people leave Medicare Advantage plans.
You cannot buy Medigap while on Medicare Advantage
It is illegal for anyone to sell you a Medicare Supplement (Medigap) policy while you are enrolled in a Medicare Advantage plan. If someone tries, report it to your State Insurance Department. If you want Medigap coverage, you’ll need to return to Original Medicare first.
Trial right — 12 months to change your mind
If you join a Medicare Advantage plan for the first time and aren’t happy with it, you have a federal “trial right” to return to Original Medicare and buy a Medigap policy within 12 months — without medical underwriting.
This page was last reviewed and updated on May 6, 2026, based on the official CMS publication Understanding Medicare Advantage Plans (April 2026). For the most current information, visit medicare.gov or call 1-800-MEDICARE.
Medicare Advantage can be a smart choice for people who want lower premiums, built-in drug coverage, and extra benefits like dental and vision — all in one plan. The tradeoff is a provider network and cost-sharing that varies by plan. Comparing your options carefully, especially your doctors, medications, and how often you travel, will help you find the right fit.
If you’d like a free side-by-side comparison of Medicare Advantage plans available in your area, feel free to reach out. There’s no cost and no obligation.
Licensed Insurance Agent Specializing in Medicare Coverage
Serving clients nationwide since 2018 | Licensed in 20+ states