As enrollment in Medicare Advantage plans continues to grow, evidence is mounting that these comprehensive plans offer better outcomes and can even cost less for retirees than traditional Medicare.
In its annual “State of Medicare Advantage” report, the Better Medicare Alliance states Medicare Advantage enrollees spend almost $2,000 less per year on plan premiums and out-of-pocket costs than those enrolled in original Medicare.
Medicare Advantage vs. Traditional Medicare
Medicare Advantage plans are offered by private insurers and serve as “all-in-one” or “package” plans. They combine the benefits of Medicare Parts A (hospital insurance) and B (medical insurance) with Part D (prescription coverage) into one comprehensive plan. These plans also usually cover extra services that aren’t covered by original Medicare, like dental and vision and even gym memberships. They also have yearly limits on out-of-pocket spending on services that Part A and Part B cover, while original Medicare doesn’t.
Over the past decade, enrollment in Medicare Advantage plans has doubled to more than 28 million people, which amounts to 45% of all Medicare beneficiaries. In Colorado, that number is nearly 48%.
With a focus on preventive and primary care, Medicare Advantage plans help ensure that enrollees receive regular screenings and care so that any medical problems can be addressed before they become more serious and costly. The report from Better Medicare Alliance finds Medicare Advantage plans cover all Medicare-covered services for 24% less than traditional Medicare.
In addition to cost savings, the report also found patients enrolled in Medicare Advantage plans often have better health outcomes, including higher rates of vaccination and cancer screenings, lower rates of hospitalization, and higher rates of follow-up care.
With regard to COVID-19, Medicare Advantage enrollees were hospitalized at a nearly 19% lower rate in 2020 and had a lower mortality rate, according to the report.
Medicare Advantage and PERACare
Colorado PERA offers Medicare Advantage plans through its health benefits program, PERACare. PERACare includes three Medicare Advantage plans: two national PPO plans with UnitedHealthcare and a regional HMO plan with Kaiser Permanente of Colorado.
PERACare also includes a subsidy, based on years of service, to help offset the cost of plan premiums. The maximum subsidy in 2021 was $115, which, depending on the plan chosen, could result in a $0 premium for PERACare coverage.
“We chose to offer Medicare Advantage plans because we could offer plans with lower premiums and a more coordinated approach that delivers better health outcomes,” said Jessica Linart, PERA’s director of insurance. “We’re glad to see the information in this report supports our efforts.”
The open enrollment period for PERACare begins on Oct. 17 and continues through Nov. 17.
To learn more about PERACare’s Medicare Advantage plans, visit copera.org/peracare.