While Medicare advantage plans are offered by private insurance carriers, they are still a part of Medicare under Part C. Medicare Advantage Plans may offer more coverage then Medicare Part A and Part B, however, in understanding Medicare Advantage Plans, you must also understand not only the benefits of the Advantage Plan, but also the downside of carrying that type of plan.
Medicare Advantage plans can come in the form of HMOs or PPOs to provide health care to their beneficiaries. Both HMOs and PPOs have restrictions on how you can obtain your health care as well as who you can use to provide those services to you.
Most Medicare Advantage plans require that you obtain your health care through their private network of health care providers. This may be a disadvantage if the number of providers in your area is limited. It also requires that you would need a referral for any specialty care that you may require as well as a pre-approval, unless it is an emergency treatment.
Insurance providers have complained that the amount of fixed fees that they receive from Medicare makes it impossible for them to make a profit and to continue offering the Advantage plans. Because of this, a large number of insurance carriers have opted to no longer offer Medicare Advantage Plans forcing their policyholders to change their health care coverage.
While there does seem to be many reasons not to choose to be a part of the Medicare Advantage Plan, it does offer many people a very good solution to their Medicare needs. If you do not mind staying within a network, the plan offers more coverage then original Medicare at a more affordable cost. While many find it cumbersome to go through the referral process, many using the plan find that it is worth the savings.