Medicare Advantage: Coverage, Costs, and Plan Responsibilities

Adapted from Understanding Medicare Advantage Plans, Centers for Medicare & Medicaid Services. The selected guidance concerns Medicare coverage and payment, not a recommendation for medical treatment. Numbered page references below refer to the linked source publication.

Coverage can depend on medical necessity, the setting, provider participation, and your plan’s rules. Use the cited publication for the full conditions and check the plan year when comparing costs or enrollment choices.

About Medicare Advantage Plans

What are Medicare Advantage Plans?

Medicare Advantage Plans are another way to get your Medicare Part A and Part B coverage. Medicare Advantage Plans, sometimes called “Part C” or “MA Plans,” are Medicare-approved plans. They’re offered by private companies that must follow rules set by Medicare. Most Medicare Advantage Plans include drug coverage (Part D). There are several types of Medicare Advantage Plans (go to page 14 for more information). Each of these Medicare Advantage Plan types has special rules about how you get your Medicare-covered Part A and Part B services and any supplemental benefits your plan covers.

If you join a Medicare Advantage Plan you’ll still have Medicare, but you’ll get most of your Part A and Part B coverage from your Medicare Advantage Plan, not Original Medicare. You’ll have the same rights and protections you would have under Original Medicare.

You must use the card from your Medicare Advantage Plan to get your Medicare-covered services. Keep your red, white, and blue Medicare card in a safe place because you may need to show your Medicare card for some services. Also, you’ll need it if you ever switch back to Original Medicare.

What do Medicare Advantage Plans cover?

Medicare Advantage Plans give almost all of your Part A and Part B benefits, including most new benefits that come from laws or Medicare policy decisions. If you’re in a Medicare Advantage Plan, Original Medicare will still help cover your costs for hospice care, some costs of clinical trials, and benefits that come from laws or Medicare policy decisions that the plan doesn’t cover.

With a Medicare Advantage Plan, you may have coverage for things Original Medicare doesn’t cover, like fitness programs (gym memberships or discounts) and some vision, hearing, and dental services (like routine checkups or cleanings). Plans also have a yearly limit on your out-of-pocket costs for all Part A- and Part B-covered services. Once you reach this limit, you’ll pay nothing for Part A and Part B-covered services.

How do Medicare Advantage Plans work?

When you join a Medicare Advantage Plan, Medicare pays a fixed amount for your coverage each month to the private company offering your Medicare Advantage Plan. However, each Medicare Advantage Plan can charge different out-of-pocket costs and have different rules for how you get services (like whether you need a referral to use a specialist or whether you have to go to doctors, facilities, or suppliers that belong to the plan’s network for non-emergency or non-urgent care). These costs and rules can change each year. The plan must notify you about any changes before the start of Open Enrollment for the next year through the Annual Notice of Change. These notices are typically mailed to you before September 30 (Open Enrollment is October 15 – December 7 every year). You can also choose to switch Medicare Advantage Plans during this time for the upcoming year. Page 11 includes more information about when you can join or switch plans.

Medicare drug coverage (Part D)

Most Medicare Advantage Plans include Medicare drug coverage (Part D). In certain types of plans that don’t include Medicare drug coverage (like Medical Savings Account (MSA) plans and some Private Fee-for-Service (PFFS) plans), you can join a separate Medicare drug plan.

However, if you join a Health Maintenance Organization (HMO) or Preferred Provider Organization (PPO) plan without drug coverage, you can’t join a separate Medicare drug plan. Go to page 15 for more information.

Note: If you’re in a plan that doesn’t offer drug coverage, and you don’t have a Medicare drug plan or other creditable prescription drug coverage, you may have to pay a late enrollment penalty if you decide to get Medicare drug coverage later. Visit Medicare.gov/basics/costs/medicare-costs/avoid-penalties to learn more about the Part D late enrollment penalty.

What are my costs?

Each year, Medicare Advantage Plans set the amount you must pay for premiums, deductibles, services, items, and drugs. The plan (rather than Medicare) decides how much you pay for the covered drugs, items, and services you get.

In certain situations, Medicare Advantage Plans with drug coverage are allowed to make changes to their drug list (formulary) during the plan year, which could affect the cost you pay for a certain drug. However, Medicare Advantage Plans can only change what you pay once a year, on January 1. You still have to pay the Part B premium. Most people pay the standard Part B premium amount every month. To get this year’s standard Part B premium, visit Medicare.gov/basics/costs/medicare-costs.

When calculating your out-of-pocket costs in a Medicare Advantage Plan, in addition to your premium, deductible, copayments, and coinsurance, consider:

• The type of health care services you need and how often you get them.
• Whether your doctors and/or suppliers are in the plan’s network.
• If you’re in a PPO, PFFS, or MSA Plan, whether your doctor or supplier is out of your plan network, but accepts assignment. Assignment means that your doctor, provider, or supplier agrees (or is required by law) to accept the Medicare-approved amount as full payment for services Medicare covers.
• Whether you may need to get approval (prior authorization) from your plan before it covers certain services.
• Whether the plan offers extra benefits (in addition to Original Medicare benefits) and if you’re likely eligible and/or need to pay extra to get them.
• Whether you have Medicaid or get help from your state through a Medicare Savings Program to pay your Medicare costs. Each type of coverage is called a “payer.” When there’s more than one payer, “coordination of benefits” rules decide who pays first.
• The maximum out-of-pocket limit set by your plan, including any maximum out-of-pocket limits for out-of-network services.

What’s the difference between a coinsurance, a copayment, a deductible, and a maximum out-of-pocket limit?

Coinsurance: An amount you may be required to pay as your share of the cost for benefits after you pay any deductibles. Coinsurance is usually a percentage (for example, 20%).

Copayment: An amount you may be required to pay as your share of the cost for benefits after you pay any deductibles. A copayment is a fixed amount, like $30.

Deductible: The amount you must pay for health care or prescriptions before Original Medicare, your Medicare Advantage Plan, your Medicare drug plan, or your other insurance begins to pay.

Maximum Out-of-Pocket Limit: A yearly limit on what you pay out-of-pocket for Part A and Part B covered services. Once you reach your plan’s limit, you’ll pay nothing for Part A and Part B services the plan covers for the rest of the year.

More cost details from each plan

If you join a Medicare Advantage Plan, review these notices you get from your plan each year:

• Annual Notice of Change: Includes any changes in coverage, costs, provider networks, service area, and more that will be effective in January. Your plan will send you a printed copy by September 30.
• Evidence of Coverage: Gives you details about what the plan covers, how much you pay, and more. Your plan will send you a notice (or printed copy) by October 15. It will include information on how to get the Evidence of Coverage electronically or by mail.

Network: Facilities, providers, and suppliers that have a contract with your plan to provide services (for non-emergency care). In some plans, you must get non-emergency care within their network. Others offer non-emergency coverage out of network, but typically at a higher cost.

Organization determination: A decision you, your representative, or your doctor can ask for, which tells you whether a service, item, or drug will be covered, or how much you’ll have to pay.

A representative is someone you can appoint to help you. Your representative can be a family member, friend, advocate, attorney, financial advisor, doctor, or someone else who will act on your behalf.

Based on your health needs, you, your representative, or your doctor can ask for a fast decision on your organization determination. If your plan denies coverage, they must tell you in writing. You have the right to appeal. For more information on filing an appeal, visit Medicare.gov/providers-services/claims-appeals-complaints/appeals.

Plan-directed care: If an in-network provider refers you for a service or to a provider outside the network, but doesn’t get an organization determination in advance, this is called “plan-directed care.” In most cases, you won’t have to pay more than the plan’s usual cost sharing. Check with your plan for more information about this protection.

Prior authorization: A decision you or your provider can get, either spoken or in writing, from your plan in advance to find out if it covers a service, item, or drug. If your plan doesn’t approve the request for prior authorization, you may have to pay the full cost of the service, item, or drug.

Who can join a Medicare Advantage Plan?

To join a Medicare Advantage Plan, you must:

• Have Part A and Part B.
• Live in the plan’s service area.
• Be a U.S. citizen or lawfully present in the U.S.

What if I have a pre-existing condition?

You can join a Medicare Advantage Plan even if you have a pre-existing condition.

What if I have End-Stage Renal Disease (ESRD)?

You can join a Medicare Advantage Plan even if you have ESRD. In many Medicare Advantage Plans, you can only use health care providers who are in the plan’s network and service area. Before you join, you may want to check with your providers and the plan you’re considering to make sure the providers you currently use (like your dialysis facility or kidney doctor), or want to use in the future (like a transplant specialist), are in the plan’s network. If you’re already in a Medicare Advantage Plan, check with your providers to make sure they’ll still be part of the new plan’s network. Read the plan materials or contact the plan you’re considering for more information.

What if I have other coverage?

Talk to your employer, union, or other benefits administrator about their rules before you join a Medicare Advantage Plan. In some cases, joining a Medicare Advantage Plan might cause you to lose your employer or union coverage for yourself, your spouse, and your dependents, and you may not be able to get it back. In other cases, if you join a Medicare Advantage Plan, you may still be able to use your employer or union coverage along with the Medicare Advantage Plan you join. Your employer or union may also offer a Medicare Advantage retiree health plan that they sponsor. You can only be in one Medicare Advantage Plan at a time.

When can I join, switch, or drop a Medicare Advantage Plan?

You can only join, switch, or drop a Medicare Advantage Plan during these enrollment periods:

Open Enrollment Period: Between October 15 and December 7 each year, anyone with Medicare can join, switch, or drop a Medicare Advantage Plan. Your coverage will begin on January 1 of the following year (as long as the plan gets your request by December 7).

Medicare Advantage Open Enrollment Period: Between January 1 and March 31 of each year, if you already have a Medicare Advantage Plan (with or without drug coverage) you can:

• Switch to another Medicare Advantage Plan (with or without drug coverage).
• Drop your Medicare Advantage Plan and return to Original Medicare. You can also join a separate Medicare drug plan.

During the Medicare Advantage Open Enrollment Period, if you have Original Medicare you can’t:

• Switch to a Medicare Advantage Plan.
• Join a Medicare drug plan.
• Switch from one Medicare drug plan to another.

You can only make one change during the Medicare Advantage Open Enrollment Period, and any change you make will be effective the first of the month after the plan gets your request. If you’re returning to Original Medicare and joining a separate Medicare drug plan, you don’t need to contact your Medicare Advantage Plan to disenroll. The disenrollment will happen automatically when you join the drug plan.

Initial Enrollment Period: When you first become eligible for Medicare, you can join a Medicare Advantage Plan (if you have both Part A and Part B) during your Initial Enrollment Period. For many, this is the 7-month period that begins 3 months before the month you turn 65, includes the month you turn 65, and ends 3 months after the month you turn 65.

If you sign up for Medicare during the first 3 months of your Initial Enrollment Period, in most cases, your coverage starts the first day of the month you turn 65. However, if your birthday is on the first day of the month, your coverage will start the first day of the prior month.

If you join a Medicare Advantage Plan the month you turn 65, your coverage will start the first day of the month after you sign up.

If you sign up during the last 3 months of your Initial Enrollment Period, your coverage will start the first day of the month after you sign up.

Switching to another plan during your Initial Enrollment Period If you join a Medicare Advantage Plan during your Initial Enrollment Period, you can change to another Medicare Advantage Plan (with or without drug coverage) or switch to Original Medicare (with or without a separate Medicare drug plan) within the first 3 months you have Medicare.

If you have Part A coverage and you get Part B for the first time between January 1 and March 31 (called a “General Enrollment Period”), you can also join a Medicare Advantage Plan. Your coverage will start the first day of the month after you sign up.

If you’re under 65 and have a disability, you’ll automatically get Part A and Part B after you get disability benefits from Social Security or certain disability benefits from the Railroad Retirement Board for 24 months.

Special Enrollment Period: In most cases, if you join a Medicare Advantage Plan, you must keep it for the calendar year starting the date your coverage begins. However, in certain situations, like if you move out of your plan’s service area, you want to join a plan in your area with a 5-star rating, or you lose other insurance coverage, you may be able to join, switch, or drop a Medicare Advantage Plan during a Special Enrollment Period. Visit Medicare.gov/special-enrollment-periods or check with your plan for more information.

You may also qualify for a Special Enrollment Period to join a Medicare Advantage Plan if you signed up for premium-Part A and/or Part B during a Special Enrollment Period, where an exceptional situation caused you to miss an earlier opportunity to sign up for Medicare. Visit SSA.gov/medicare/sign-up for more information on signing up for Medicare Part A and/or Part B.

How can I join a Medicare Advantage Plan?

Not all Medicare Advantage Plans work the same way. Before you join, you can find and compare Medicare Advantage Plans in your area by visiting Medicare.gov/plan-compare or calling 1-800-MEDICARE (1-800-633-4227). TTY users can call 1-877-486-2048. Once you understand the plan’s rules and costs, you can join by:

• Visiting Medicare.gov/plan-compare and searching by ZIP code to find a plan and join. You can also log in to your secure Medicare.gov account and add your prescriptions and pharmacies to help you compare plans in your area. If you have questions about a plan, select “Plan Details” on the search results page to get the plan’s contact information.
• Calling the plan you want to join, or visiting the plan’s website to find out if you can join online.
• Filling out a paper enrollment form. Contact the plan to get an enrollment form, fill it out, and return it to the plan. All plans must offer this option.
• Calling 1-800-MEDICARE (1-800-633-4227). TTY users can call 1-877-486-2048.

When you’re ready to join a Medicare Advantage Plan, you’ll need this information from your Medicare card:

• Your Medicare Number
• The date your Medicare Part A and/or Part B coverage started

Remember, when you join a Medicare Advantage Plan, in most cases, you must use the card from your Medicare Advantage Plan to get your Medicare-covered services. For some services (like hospice care), you may need to show your red, white, and blue Medicare card.

Source and further reading

Understanding Medicare Advantage Plans — Centers for Medicare & Medicaid Services. Public domain U.S. government educational material, accessed October 28, 2026. Fynoptic has selected sections, removed print navigation, and reformatted the text for this guide. The agency does not endorse Fynoptic.