Medicare vs Medicare Advantage: Difference and Comparison

Ever since health insurance policies were introduced, people have shown a keen interest in them.

This is so because it covers the expenses of the hospital, medicines, check-ups, and many other small entities under it.

The person with such insurance policies does not require inconvenience during the treatment as the payment is directly cleared from the respective company.

Key Takeaways

1. Original Medicare is a government-run health insurance program for seniors and certain disabled individuals, covering hospital and medical services.
2. Medicare Advantage is a private health insurance option that offers additional benefits, such as dental and vision coverage, and combines parts of Original Medicare into one plan.
3. Costs, provider networks, and plan structures differ between Original Medicare and Medicare Advantage.

Medicare vs Medicare Advantage 

Medicare is a federally funded health insurance program that provides coverage for certain healthcare services to eligible individuals in the United States. Medicare Advantage (Part C) is an alternative to traditional Medicare, offered by private insurance companies that are approved by Medicare.

Medicare is a plan that is offered by the federal government of the United States to its people.

The government has made a cost ratio of 80-20, meaning that 80% of the treatment cost will be covered under the plan while the individual will pay the remaining 20%.

The plan mainly includes all the hospital and medicine bills, so it is a good choice for the person.

Medicare Advantage is a plan that is offered by different private companies to the people. They have a varied number of plans and coverage plans according to the budget of the people.

The cost covered during the treatment completely depends on the plan or coverage purchased by the respective person.

Comparison Table

Parameters of Comparison	Medicare	Medicare Advantage
Coverage	Includes complete hospital bill and medical bill	Includes hospital bill, medical bill, and the additive benefits
Drug Coverage	Do not include in the plan	Include in the plan
Additional benefits	Absent	Present like – eye check-up, hearing, dental, fitness, etc
Offered By	Government	Private companies
Referrals	Not required	Sometimes it must be required
Out-of-pocket Limit	No	Yes but with the annual limit
Provider	Anyplace that is enrolled for accepting Medicare	Only places where the respective company has their tie-up with
Cost	A ratio of 80/20	Depends on the plan purchased by the company

What is Medicare?

Medicare is a plan that is offered by the Government of the United States of America to its citizens. The plan is available to every person who has citizenship in the United States of America.

The Medicare policy includes two plans – A and B. In the Plan, A series, all the nursing facility, in-patient, home health, etc., treatment is covered, while in the Plan B series, all the medical equipment, outpatient facility, home treatment, etc.

The cost of the plan is distributed in a ratio of 80:20, where the Government covers 80% of the total expense of the treatment while the rest of the 20% of the expense is to be covered by the individual.

The out-of-pocket limit is absent.

The policy does not include the cost of drugs within it. Also, any additional benefits are absent in the policy. The person having a Medicare policy does not require to have a referral from the doctor.

They have to visit a clinic, hospital, or medical facility where Medicare is accepted.

What is Medicare Advantage?

Medicare Advantage is a plan that is offered by various private companies to citizens.

After purchasing the policy, the complete management of it is under the company, and the Government doesn’t have any role to play in it. Buying a private Medicare healthcare policy is a complete decision of the individual.

The Medicare Advantage includes all the facilities of Plan A and Plan along with the additional benefits. These additional benefits of the Medicare Advantage include – eye check-ups, hearing, dental, fitness, etc. The cost of the policy is such a way that the individual has to pay according to their respective policy and plan.

The policy also includes drug coverage, and to avail of the benefit of the Medicare Advantage, the person has to go to the clinic, hospital, or medical facility that has the tie-up with their respective policy company; otherwise, it won’t release funds. 

Main Differences Between Medicare and Medicare Advantage

1. The Medicare facility includes all the payments to be done in the hospital and the medicine purchased bill, whereas comparatively, on the other hand, the Medicare Advantage includes all the payments done against the hospital bill, the medical bill, and the additional tests covered during the treatment.
2. Drug coverage in the Medicare plan is absent, whereas comparatively, on the other hand, drug coverage in the Medicare Advantage plan is present and is included in the charges.
3. The additional benefits offered in the Medicare plan are nothing while comparatively, on the other hand, the additional benefits offered on the Medicare Advantage plan include many benefits within it, and they are – vision, hearing, fitness, dental, and many others.
4. The Medicare facility is offered by the Government to their people while comparatively, on the other hand, the Medicare Advantage is offered by private companies and varies upon different plans and coverage.
5. Doctor’s referrals are not required in the Medicare plan for any treatment wheres comparatively. On the other hand, in the Medicare Advantage plan, most of the time, the doctor referrals are counted for the treatment.
6. In the Medicare plan, there is no out-of-pocket limit, while comparatively, on the other hand, in the Medicare Advantage plan, the out-of-pocket limit is based annually.
7. To avail of the Medicare plan, one may visit any clinic or hospital or medical facility, but the only point to be noted is that one must be enrolled and accepts the Medicare plan while comparatively, on the other hand, the Medicare Advantage can be availed only where the company has its tie-ups with.
8. The cost of the Medicare plan is based on an 80-20 ratio where 80% of payment is made through the plan, and the individual does the rest while comparatively, on the other hand, the cost of Medicare Advantage depends on the different plans and coverage burrowed by the person.

References

1. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6907897/
2. https://link.springer.com/article/10.1007/s11606-020-05826-x
3. https://www.healthaffairs.org/doi/full/10.1377/hlthaff.2018.0147
4. https://jamanetwork.com/journals/jamanetworkopen/article-abstract/2777601