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Medicare 101: The Difference Between Original Medicare and Medicare Advantage

Medicare can be a confusing topic, so if you are planning to initially enroll or review your options during the Annual Election Period (AEP) it’s important to explore all your choices.

Susan Schaffrath, a senior services advocate counselor at Advocate Christ Medical Center and Certified Senior Health Insurance Program (SHIP) Counselor trained by the Illinois Department on Aging, offers 5 key points you should know:

1: What is the difference between Original Medicare vs. Medicare Advantage?
Schaffrath says there are two main ways to obtain Medicare coverage: Original Medicare or a Medicare Advantage plan.  Use the chart below to help you understand your Medicare coverage choices.

2: What is the Medicare Annual Election Period (AEP)?
The Medicare Annual Election Period (AEP) occurs every year from Oct. 15 to Dec. 7. During this time, individuals can change their Medicare health or Part D prescription drug coverage. This includes returning to Original Medicare or joining or switching to a Medicare Advantage plan. New coverage begins January.

Schaffrath says you should ask yourself three questions when considering your Medicare options:

1. Does my current Medicare coverage allow me to see all the providers that are important to me?
2. Are my prescription drug costs as reasonable as they can be?
3. Do I currently have all the health care benefits that are most essential to me?

If answered no to any of these questions you may want to consider exploring other Medicare options. Some worth looking into may be:

• Medicare Advantage, often referred to as MA plans, bundle your Medicare Part A and B benefits and often include a prescription drug plan. These types of plans often resemble employer HMO and PPO plans.
• Medicare Cost Plans (available in Wisconsin) are similar to MA plans. The difference between these plans is that Original Medicare will pay for Medicare covered services if a cost plan enrollee receives care outside of the cost plan network. This does not happen with MA plans.

Consider the following if you want to select one of these plan types:

• MA plans offer one way to receive Medicare benefits through private insurance companies approved by Medicare.
• MA plans provide the same Medicare Part A and Part B coverage as Original Medicare and most plans bundle in prescription drug coverage.
• MA plans may cover additional benefits that Original Medicare does not cover, for example vision, dental, hearing and transportation.
• You continue to pay your Medicare Part B monthly premiums whether you enroll in a MA plan, Cost plan or Original Medicare.
• Plan premiums vary and most have copays for each medical service received. In addition, they also have a yearly limit on what you pay for medical services.
• In most cases, you will need to use doctor’s and services that are in the MA plan’s network.
• MA plans are not subject to the mandated benefit requirements under Wisconsin insurance law (In Wisconsin, some Medicare Cost Plans and Medicare supplements are required to cover the treatment of certain specific health conditions, and certain types of healthcare providers even when Medicare does not cover these expenses).

When can I enroll in a Medicare Advantage plan?
You can enroll in a MA plan when you first become Medicare eligible during what’s called your Initial Enrollment Period (IEP). The IEP is a 7-month period that begins three months before you turn age 65, the month you turn 65 and ends the third month after your 65^th birthday. You can also enroll during the Annual Election Period and in certain circumstances if you qualify for a Special Enrollment Period.

What if I enroll in a Medicare Advantage plan and I don’t like it?
There are special trial rights available for people who join a MA plan when they are first eligible for Medicare due to age 65. They may drop the MA plan and go back to Original Medicare anytime within the first 12 months of enrolling in a plan.

5: What are available Medicare resources?
Schaffrath knows Medicare enrollment can be complicated, but she reminds individuals help is available to ensure you have the right coverage. Check out these available resources:

• For more information on Medicare resources and related services in your area:
  • If you are a resident of Illinois, visit com/Medicare.
  • If you are a Wisconsin resident, visit org/Medicare.
• To view and compare 2022 available plans in your area, visit the Medicare plan finder at gov/plan-compare or call 1-800-MEDICARE after October 1.
• State Health Insurance Assistance Program (SHIP) counselors are available to assist you. To contact SHIP, visit shiptacenter.org or call 877-839-2675. TTY users can call 1-877-486-2048.

This article was contributed by: Liz Fitzgerald