In Medicare Advantage plans, the company that offers the plan sets the premium and decides on the cost sharing. You’ll need to look at the details of each plan you’re considering.
What’s your share of Medicare Advantage costs?
Most Medicare Advantage plans use a combination of deductibles, coinsurance and copays to share the costs with you. These cost-sharing arrangements will usually apply to all of the services the plan covers—hospital stays, doctor visits, drug coverage if you have it, and so on.
How does Medicare Advantage cost sharing work?
You will need to investigate the details of a plan to get the full story on its cost-sharing. Plans vary widely, and their cost sharing usually works quite differently from the cost sharing used in Original Medicare (Parts A and B).
For example, under Medicare Part A, your cost sharing for a 5-day hospital stay in 2012 would be your $1,156 deductible. With a Medicare Advantage plan, you might pay a $150 per day copay for each day in the hospital. This is just an example, and each plan may vary.
Out-of-pocket limits
Limits on your cost sharing are another way Medicare Advantage plans may differ from Original Medicare.
With Original Medicare, there is no limit on your out-of-pocket cost-sharing amounts for covered services. In some situations, like extremely long hospital stays, your coverage under Part A can end entirely, and you become responsible for paying all of your own costs.
In contrast, all Medicare Advantage plans offer a feature that caps your out-of-pocket spending for cost sharing like
copays and
deductibles in any given year. The out-of-pocket maximum will vary by plan, but the most it can be for in-
network services in 2012 is $6,700.
Medicare Advantage drug cost sharing
Medicare Advantage plans that include drug coverage generally share costs with members in much the same way that standalone Medicare Part D prescription drug plans do.
Cost-sharing terms and amounts vary from plan to plan. When researching Medicare costs, you'll need to shop around for a plan that best fits your needs.
Example: coordinated care in-network office visit
| Michael has a coordinated care Health Maintenance Organization (HMO) plan. He visits an in-network doctor. |
|---|
| Office visit |
$100 |
| Copay for office visit |
$10 |
| Total Michael pays |
$10 |
Example: brief hospital stay
| Maria stays in the hospital three days, goes home for a week, and then spends four more days in the hospital. Her coordinated care plan has a $150 copay for each day of a hospital stay. |
|---|
| Days 1 to 3 copays for first stay |
$450 |
| Day 1 to 4 copays for second stay |
$600 |
| Total Maria pays |
$1,050 |
Example: long hospital stay
| William stays in the hospital 185 days. His coordinated care plan applies a $150 per day copay for each day of a hospital stay and puts a $3,000 maximum, or cap, on out-of-pocket spending. |
|---|
| Days 1 to 20 (20 days at $150 per day) |
$3000 |
| Day 21 to 185 (after the cap is reached) |
$0 |
| Total William pays |
$3,000 |