What is a Medicare Cost Plan?

Tamera Jackson by Tamera Jackson | Licensed since 2007
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This article was updated on: 07/05/2018

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Medicare Cost Plans are not available in all parts of the country, but if you live in one of the areas where these plans are offered, here’s what you might want to know.

Medicare Cost Plans are similar to Medicare Advantage plans in some ways, but are different in other ways. Like a Medicare Advantage plan, a Medicare Cost Plan may provide benefits that Original Medicare doesn’t, and like Original Medicare, it allows you access to out-of-network health care providers as long as you continue to have Medicare Part A and Part B.

If you choose to go out of the plan’s network, you may still be covered by Original Medicare. Your deductibles and coinsurance amounts may apply.

Unlike Medicare Advantage plans, you can typically enroll in a Medicare Cost Plan even if you’re only enrolled in Medicare Part B. You can sign up or drop the plan anytime, instead of having to wait for certain enrollment periods.

Medicare Cost Plans are offered by private insurance companies who contract with Medicare. They are often sponsored by employer or union groups.  The plan may or may not include coverage for prescription drugs or other benefits not available under Original Medicare.

Who might want to consider a Medicare Cost plan?

One of the main advantages of a Medicare Cost plan is that you do not lose your Original Medicare benefits, and have the option to go out of network for health-care services without restriction. This may be an attractive benefit if you frequently travel out of your plan network area

If your Medicare Cost plan doesn’t include coverage for prescription drugs, you may also purchase a stand-alone Medicare Part D Prescription Drug Plan.

What’s the difference between a Medicare Cost Plan and Medicare Advantage?

The Medicare Part C program (Medicare Advantage) is also administered by private companies approved by Medicare, and premiums may vary by location and company. You must also pay your Part B premium when you enroll in a Medicare Advantage plan, plus any other premium your plan requires. Most Medicare Advantage plans use a provider network and offer benefits for prescription drugs; some even cover routine vision, dental, and hearing care, as well as wellness programs.

Unlike Medicare Cost Plans, however, Medicare Advantage plans are an alternate way to get all your Original Medicare benefits and once you enroll, you are no longer eligible to use Part A and Part B, except for hospice care, which is still provided under Part A. While minimum coverage rules are set by the Medicare program, your actual benefits and coverage amounts are determined by your plan.

If you have questions about a Medicare health plan that may meet your needs, I’m happy to help. You can get information prepared for you in an email, if you prefer, or schedule a telephone call at your convenience by clicking one of the links below. To see if Medicare Cost plans are available in your area, or to see plans you may qualify for, click the “Compare Plans” button.

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