What is most important to consider when choosing an Advantage Plan?

Question: What is most important to consider when choosing an Advantage Plan? Which plans and companies are the best?

This is Part 4 of my "Medicare Reset" series designed to prepare those on Medicare for the Annual Enrollment Period (AEP) that starts Oct. 15 and runs through Dec. 7.. AEP is the only time of the year when those on Medicare can make any change they wish to their current plan lineup.

With more than 600,000 people expected to have their current Advantage Plan discontinued, major benefit changes to many other Advantage Plans, modifications to Part D prescription coverage, as well as the highest increases in Supplement premiums in the past 20 years, more people than ever are going to need or want to change Medicare health and drug plans. If you're in one of these positions, it's going to be vital to educate yourself in order to make a wise decision. This series is written to help you do just that.

You can read the previous editions of the Medicare Reset series on our website, GetYourBestPlan.com, or our Facebook Group, Ask the Medicare Specialist.

Answer: I began working in the Medicare health insurance industry in 2007 and my agency, The Health Insurance Store, opened in 2008. Since that time, in response to new and evolving regulations, market shifts, and changes in health care and costs, the Medicare Advantage program has gone through several trends and phases. The past two years in particular have been very volatile for Advantage Plan insurance companies as far as profitability, with almost all experiencing significant decreases in profits, and even losses, which started a new trend of companies making some dramatic changes in benefits, passing on more costs to you, the insured. Therefore, the 2027 Medicare AEP is going to be one where almost everyone currently on an Advantage Plan needs to be active in knowing what benefit changes have been made and make sure they're enrolled in the right plan for next year. In addition, with an average of 25% to 40% premium increases over the past two years, Supplements have become unaffordable and many people will need to make a move to an Advantage Plan for the first time.

The most important considerations, in order of importance, for us at The Health Insurance Store when advising clients what Advantage Plans to consider are the following: access to doctors and hospitals, hospitalization co-pays, the annual Maximum Out of Pocket (MOOP) limit, monthly premiums, drug coverage structure, co-pays other than a hospital stay, and generosity of "extras" like dental and OTC benefits.

I would like to remind everyone that Advantage Plans have several Federal regulations they must follow. All companies and plans, regardless of premium, must cover the same services that Original Medicare does and as good or better than Medicare. This means every company covers the same exact categories of benefits with the only differences being what co-pays are for the same services, monthly premiums, networks of doctors and hospitals, how much ancillary benefits are offered, and the Maximum Out of Pocket (MOOP).

In addition, Advantage Plan companies and plans cannot have any pre-existing condition clauses, must accept everyone who has Medicare Parts A and B regardless of current or past health issues, and are required to pay claims the first day the policy goes into effect regardless of health history. Therefore, there's no need to be fearful of moving to a new plan or company. It's a mistake far too many seniors make and insurance companies count on.

So, who are the best companies and plans? The answer is whomever and whichever offers the best value based on the combination of those 7 important factors I listed above. The best companies and plans can be different each year as benefits change. As that happens, so do our recommendation for our clients and we send out a recommendation letter prior to every AEP listing changes and advising if staying on their current plan is the best option or if another should be considered. There was actually a period from 2009 to 2015 when the majority of our clients were on plans from 4 different companies in that seven-year span.

Let's briefly go over each of what we believe to be the most important factors to consider when choosing an Advantage Plan and why.

Access to doctors and hospitals: If a plan doesn't have your doctors and hospitals in network, I don't care how good the benefits are. It's basically worthless. When choosing my own health insurance, I personally want the largest network possible. However, Advantage Plans, unfortunately, are trending to where the plans that offer the best overall value in terms of low premiums and co-pays as well as the most generous "extras," such as dental benefits, are those with smaller networks, often sold by insurance companies who also own hospitals. As we move forward, I believe people are going to need to make a tough decision. Are you willing to go with a plan that has a smaller network with less choices in doctors and hospitals but offers a better overall benefit package and lower premiums? Or do I want to pay more premiums and/or accept higher co-pays and less ancillary benefits in exchange for a larger network and more choices in doctors and hospitals?

With that in mind, it's also extremely important to understand that all PPOs are not created equal and choosing one doesn't guarantee access to any and every doctor and hospital. That's a very common misconception. The fact is only a few PPOs have true national networks, and most people have no idea that out of network hospitals and doctors are under no obligation to accept a PPO Advantage Plan. And many don't, outside of the Emergency Room. If you spend summers or winters in another area of the country, it's extremely important to choose a PPO plan that will provide in network access to doctors and hospitals when away from home.

Hospital co-pays: At The Health Insurance Store, we've always advised clients to choose plans that have co-pays with a fixed cost regardless of how long the hospital stay lasts. The past 10 years, those co-pays have been from $250 to $500 per stay. However, this is the area that in 2026 had, and in 2027 will have, huge increases in out of pocket costs. We just learned that on one of the 3 most popular plans amongst our clients, the inpatient hospital co-pay will increase from $400 per stay to $300 perday for up to seven days, meaning a potential total co-pay of $2,100! That's a $1,700 difference from this year to next for a seven-day stay or longer!

A couple of years ago, my father was diagnosed with C-dif and over a two-year period was in and out of the hospital 10 times, with each stay lasting five days or longer. Had he been on a plan with a $300 per day hospital co-pay, he would have met his MOOP in hospital bills alone and paid $8,000 to $15,000 out of pocket. On a plan with a flat $400 co-pay per stay, in comparison, it would have cost him just $4,000 for those same 10 hospitalizations.

Maximum Out of Pocket: Also known as the MOOP, it represents the most one can be billed for medical services in a calendar year. In 2026 the most the MOOP could be was $9,250, but the most popular plans had an average MOOP ranging from $4,000 to $6,000. The lower the MOOP the better. In a scenario such as the one my dad went through, in the event of a cancer diagnosis where chemo and/or radiation is necessary, or expensive outpatient infusion or injection therapy that more and more people are being prescribed is required, a lower MOOP can save you thousands of dollars.

Premiums: Medicare Advantage is very odd in that paying a higher premium often doesn't ensure better benefits! In fact, the opposite is likely to be true! In 2026 and the five years prior, we rarely advised clients to enroll in a plan with premiums higher than $35 per month, while the most popular plans across the country had $0 premiums. We always look for low-cost premium plans that offer the best value in terms of low co-pays and extra benefits. However, I believe in 2027 and beyond, we may have to consider plans with wider range of premiums than in the past in order to get lower co-pays or more choices in doctors and hospitals. It won't be as easy as simply taking a $0 or low-cost premium.

Drug coverage: Despite the new regulation that limits out of pocket costs for prescription drugs in a calendar year, the presence of a deductible and the cost of Tier 3 medications can make a huge difference. Some plans will have a deductible for Tiers 3 through 5 drugs as much as $700 in 2027, while select plans will have a much lower or no deductible. Also, there are plans where Tier 3 medications have a flat co-pay of $40 to $50 instead of 25% coinsurance. In 2027, those who take brand name drugs can save a significant amount of money, as much as $700 to $1,900 a year by choosing plans with a lower or no drug deductible and/or flat co-pays on Tier 3 meds.

Co-pays for services other than hospitalizations: For those on a fixed income, especially people who see lots of doctors and often have tests ordered, the co-pays for PCP and Specialist visits, blood work, X-rays, CT-scans, MRIs, physical therapy, and more also matter. We obviously want a plan that has lower overall co-pays if possible.

Generosity of "extra benefits": Over the past eight years, nothing has driven enrollments into Advantage Plans more than the ancillary benefits, or "extras" they provide that neither Medicare nor Supplements offer such as dental, vision, hearing, OTC allowances, a free gym benefit, and even groceries on select plans. But notice I listed this last in importance. That's because the generosity of the extras peaked in 2024 and we've seen a reduction or elimination of many of these benefits since. I believe that trend will continue in 2027. In many states there already is no more comprehensive dental coverage for fillings, crowns, root canals, and dentures. It's limited to cleanings and X-rays only. In Pennsylvania and other states, comprehensive dental is still covered, but the maximum annual benefit has been lowered from as much as $3,000 to just $1,000 and the percentage of the claims paid for comprehensive services has been reduced from 100% to 50%. The bottom line is there's nowhere near the value in the ancillary benefits there was a couple of years ago. However, when plans are close to equal in terms of the other areas of importance, the amount of these extras can be the deciding factor in what plan we advise clients to choose.

Making a choice or changing plans doesn't have to be stressful.

With so many considerations and as many as 10 companies and 100 or more plans to choose from in some states and regions, identifying which have the overall best value and are worthy or your consideration can be a difficult task. A change in companies can also make some people nervous. Insurance companies count on your fear of change and It's a very common and costly mistake to remain on a non-competitive plan due to apprehension. Reach out to us at The Health Insurance Store and one of our experienced agents will direct you to the best options in Advantage Plans based on your individual situation and needs, ensuring you don't overpay in premium or out of pocket costs while maintaining access to the doctors and hospitals you want and need.

To make an appointment for a no cost consultation, or if you have questions regarding today's edition of the Medicare Reset series or any other Medicare related topic, give our office a call at 724-603-3403 or email me personally, [email protected].

Next week, Part 5 of the Medicare Reset series will explore what's most important to consider with Supplements (Medigap), and what companies and plans are best.