How Does Cost-Sharing Work With Medicare Advantage Plans?

There are currently greater than 1 million Medicare beneficiaries who have Medicare benefits that also have enrollments in Medicare Advantage Plans. Of this number, fifteen percent are dual eligible. Under one option for Medicare Advantage Plans which the Congressional Budget Office reviewed, Medicare beneficiaries would have the responsibility of having higher co-pays but would also be protected from large medical bills if a catastrophic illness should occur. This advantage plan would also limit the current supplemental insurance policies in which seniors use together with their Medicare benefits. This plan may make beneficiaries prolong lowering cost and seeking medical treatment.

Current Medicare System

The existing system call for Medicare patients to pay an estimated deductible of $ 1,148 per hospitalization stay in 2011 in addition to daily co-payment for skilled nursing and longer stays. The beneficiaries are also responsible for 20% of extra costs in addition to outpatient services deductibles, which are estimated to be about $ 142 by the CBO in 2011.

Benefits of Medicare Advantage Plans

With some Medicare Advantage Plans cost sharing is simplified: A singe deductible of $ 525 for outpatient and inpatient services, a 20% co-insurance charge on expenses in addition to the deductable and a cap of $ 5,250 on the total a patient may be liable for within a year. This plan could not only serve to transfer some of the financial burden for the return of additional pedestrian care to seniors but it may also protect seniors from enormous medical bills. This transfer would not affect the twenty five percent of elderly that buy medigap coverage which are supplemental insurance police in which cost-sharing obligations and Medicare co-payments are covered. The elderly that have medigap polices that are protected from co-payments, use greater amounts of medical services. The CBO reports that limiting medigap policies could cause seniors to become more discouraged to visit the doctor.

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