Investing in a Medicare plan is investing in a safer future. But do you need to spend the last dime on it?
Of course, you don’t!
In this guide, we’ll walk you through different types of plans, how to evaluate them, and help you choose the one that will not be a burden to your budget.
Article Contents
Types of Medical Care Plans
Understanding your options is the first step.
Here are the most common healthcare plans available:
1. Health Maintenance Organization (HMO)
- How it works: With an HMO, you’ll pick a primary care physician (PCP) who acts as your go-to for all things healthcare. Need to see a specialist? You’ll need a referral from your PCP, and you’ll have to stick to the HMO’s network unless it’s an emergency.
- Why it’s great: These plans tend to be more budget-friendly, especially if you’re good with sticking to in-network providers. Plus, they put an emphasis on preventative care.
- Trade-offs: Your options are pretty limited if you want to see a doctor outside of the network.
2. Preferred Provider Organization (PPO)
- How it works: A PPO gives you more freedom to choose your doctors and specialists. You don’t need referrals, and out-of-network providers are an option, though they will cost you more.
- Why it’s great: It’s perfect if you value flexibility and don’t mind paying a bit more for it.
- Trade-offs: Higher premiums are the price you pay for that freedom.
3. Exclusive Provider Organization (EPO)
- How it works: Think of an EPO as a mix of HMO and PPO. There’s no need for referrals, but you’ll need to stay within the network unless it’s an emergency.
- Why it’s Great: Premiums are lower than PPOs, and you still get direct access to specialists. Additionally, if you’re wondering: are Medicare premiums tax deductible, you should know that certain parts of your premiums might be eligible, especially if you meet specific criteria for itemizing deductions, so be sure to check it out.
- Trade-offs: Like HMOs, you’re restricted to in-network providers.
4. Point of Service (POS) Plan
- How it works: This plan combines the best of HMOs and PPOs. You’ll choose a PCP and need referrals for in-network specialists, but out-of-network care is also covered (though it’s pricier).
- Why it’s great: You get a bit of flexibility with out-of-network options.
- Trade-offs: Be prepared for higher costs when venturing outside the network.
5. Catastrophic Plans
- How it works: These plans are all about covering you for the big stuff, such as emergencies and major illnesses. They’re available for people under 30 or those who qualify for a hardship exemption.
- Why it’s great: Low premiums and essential health benefits make this a good option for young, healthy individuals.
- Trade-offs: The high deductible means you’ll pay a lot out of pocket before your coverage kicks in.
6. Fee-for-Service (FFS) Plans
- How it works: These are old-school plans where you pay for services as you use them.
- Why it’s great: You have total freedom to choose your providers.
- Trade-offs: They’re pricey and less common these days.
Metal Levels of Health Insurance
While types of medical care plans define how you access healthcare services, metal levels determine how costs are shared between you and the insurer.
The five metal levels of health insurance are:
1. Bronze
- Coverage: The insurer pays 60%, while you cover 40% of the total healthcare costs.
- Premiums: The lowest, averaging around $462 per month, but can vary significantly across states.
- Considerations: While the monthly premiums are affordable, the deductibles and out-of-pocket costs are higher, so you’ll pay more when you need care.
It could be the best choice for you if you are a healthy individual with minimal medical expenses.
2. Silver
- Coverage: The insurer pays 70%, while the 30% of the total healthcare costs is on you.
- Premiums: Moderate, averaging about $584 monthly, but can vary across states.
- Considerations: A solid middle ground, but care costs can still add up depending on your usage.
It could be the best option for you if you want moderate premiums and out-of-pocket expenses. Also, if you qualify for cost-sharing reductions, Silver plans can significantly lower your overall costs.
3. Gold
- Coverage: The insurer pays 80%, while you pay 20% of the total healthcare costs.
- Premiums: Higher, averaging around $641 per month but can vary across the states.
- Considerations: You’ll pay more each month, so it’s ideal if you frequently need healthcare services.
This could be the right choice for you if you expect to use medical services often, as lower deductibles mean you’ll spend less out of pocket for care.
4. Platinum
- Coverage: The insurer pays 90%, and you pay just 10% of the total healthcare costs.
- Premiums: The highest, averaging about $813 monthly in but can vary across states.
- Considerations: While it provides the best coverage, the high premiums might not be practical unless you need extensive medical services.
This could be the right path for you if you anticipate needing significant medical care, as it offers the lowest out-of-pocket expenses.
Best Medicare Service Providers
Here are some notable service providers and their standout features to help you make an informed choice:
1. Humana
- Why it stands out: Offers plans in 89% of the U.S. states.
- Perks: Includes SilverSneakers memberships (a health and fitness program designed for adults aged 65 and older), an insulin savings program, and meal delivery services.
- Potential downsides: Not all plans are available in every location.
2. Anthem
- Why it stands out: Special needs plans, $0 premium options, and a healthy meals program.
- Perks: Provides SilverSneakers memberships, personal home helper services, and extra dental and vision plans.
- Potential downsides: Coverage is limited to 14 states.
3. Aetna
- Why it stands out: Offers $0 premium plans in 36 states and 24/7 access to a nurse hotline.
- Perks: Known for excellent value plans and its partnership with CVS Health.
- Potential downsides: Coverage is slightly reduced for 2025.
4. Wellcare
- Why it stands out: Provides a wide range of wellness benefits, including zero-dollar premium plans.
- Perks: Includes telehealth options, free fitness memberships, and discounts on alternative medicine.
- Potential downsides: Plan options depend on your location.
5. AARP
- Why it stands out: Ideal for veterans and offers a broad variety of plans.
- Perks: Affordable PPO plans and an extensive provider network.
- Potential downsides: The requirement for AARP membership.
6. UnitedHealthcare
- Why it stands out: It boasts the largest provider network and a $0 copay for virtual visits.
- Perks: Offers over-the-counter credits (OTC), reduced copays, and comprehensive plans with dental, vision, and hearing benefits.
- Potential downsides: Specialized needs plans can be pricey.
7. Kaiser Permanente
- Why it stands out: Tops the charts for member satisfaction and customer service.
- Perks: Consistently high CMS ratings and a variety of HMO plans.
- Potential downsides: Limited to specific service areas.
8. Blue Cross Blue Shield
- Why it stands out: It offers the most plan variety and has extensive coverage.
- Perks: Simplifies plan comparisons online and includes hearing, dental, and vision benefits.
- Potential downsides: Deductibles and copays can be higher for certain plans.
Key Factors to Consider When Choosing Your Medicare Plan
When comparing plans, keep these factors in mind:
- Monthly premiums: Choose a plan with a premium that fits your budget.
- Deductibles and out-of-pocket costs: Ask around how much you’ll pay before the plan covers your expenses.
- Coverage for essential services: Look for plans that cover preventative care, prescriptions, and visits to specialists.
- Network restrictions: Don’t forget to check if your preferred doctors and hospitals are in-network.
- Prescription drug coverage: If you regularly take medications, check for tiered formularies and co-pay details.
- Maximum out-of-pocket limit: See what limit you can hit before the insurer starts covering 100% of services.
3 Strategies for Choosing the Right Plan
Here is what you can do to make sure you end up with the right medicare plan for you:
1. Understand Your Healthcare Needs
Ask yourself what kind of medical care you’ll likely need in the upcoming year. Think about if you will require routine check-ups, ongoing prescriptions, or any other procedures.
If you’re managing a chronic condition, integrate the costs for specialist visits, therapies, and regular diagnostic tests.
2. Use Online Comparison Tools
Online comparison tools can help you to compare multiple plans side by side. These tools provide details on monthly premiums, deductibles, copayments, and coverage options.
Some even let you input your healthcare needs, like specific medications or doctors you want to keep.
3. Check Eligibility for Subsidies
If your income falls within a certain range, you might qualify for financial assistance through the Affordable Care Act (ACA).
These incentives often come in the form of premium tax credits, which can drastically reduce the cost of monthly premiums.
Depending on your circumstances, you may also qualify for reduced deductibles, copays, or coinsurance through cost-sharing reductions.
Check your eligibility on HealthCare.gov, and ensure you understand how to maximize these benefits.
Overview of Health Insurance Plans, Providers And Types
If your eyes get tired of reading through this much text, here are the three tables summarizing all the key points:
Plan Types
| Plan Types | How It Works | Benefits | Drawbacks |
| HMO | Requires a PCP referral for specialists and in-network care, except for emergencies | Budget-friendly with an emphasis on preventative care | Limited to in-network providers |
| PPO | No referrals needed; out-of-network care allowed at higher costs | Flexible with access to more providers | Higher premiums |
| EPO | No referrals needed; in-network care required unless it’s an emergency | Lower premiums with direct specialist access | Restricted to in-network providers |
| POS | PCP and referrals needed for in-network care; out-of-network care covered at higher costs | Flexibility with out-of-network options | Higher costs for out-of-network care |
| Catastrophic Plans | Covers emergencies and major illnesses; for those under 30 or with hardship exemptions | Low premiums with essential health benefits | High deductibles mean higher out-of-pocket costs initially |
| FFS | Pay for services as you use them | Total freedom to choose providers | Expensive and less common today |
Metal Levels
| Metal Level | Coverage Split (Insurer/You) | Premiums (Avg. Monthly) | Best For | Considerations |
| Bronze | 60% / 40% | $462 | Healthy individuals with minimal medical needs | Low premiums, but high deductibles and out-of-pocket costs |
| Silver | 70% / 30% | $584 | Balanced choice for moderate healthcare needs | Cost-sharing reductions available if eligible |
| Gold | 80% / 20% | $641 | Frequent healthcare users | Higher premiums, but lower out-of-pocket expenses |
| Platinum | 90% / 10% | $813 | Extensive healthcare users needing top coverage | Highest premiums, but minimal out-of-pocket expenses |
Service Providers
| Provider | Key Features | Advantages | Disadvantages |
| Humana | Offers plans in 89% of U.S. states. | Includes SilverSneakers, insulin savings, and meal delivery. | Not all plans available everywhere. |
| Anthem | Special needs plans and $0 premium options | Extra dental/vision plans, healthy meals, SilverSneakers | Limited to 14 states |
| Aetna | $0 premium plans in 36 states with 24/7 nurse hotline | CVS partnership and excellent value plans | Coverage slightly reduced for 2025 |
| Wellcare | Wide range of wellness benefits | Telehealth, fitness memberships, discounts on alt medicine | Plan availability depends on location |
| AARP | Ideal for veterans; broad variety of plans | Affordable PPO plans and extensive provider network | Requires AARP membership |
| UnitedHealthcare | Largest provider network; $0 virtual visit copay | OTC credits, reduced copays, dental/vision/hearing benefits | Specialized plans can be pricey |
| Kaiser Permanente | Tops member satisfaction and customer service | High CMS ratings, variety of HMO plans | Limited service areas |
| Blue Cross Blue Shield | Extensive plan variety and coverage | Simplified plan comparisons, hearing/dental/vision benefits | Higher deductibles/copays for certain plans |
