5 Reasons to Ditch Your Medicare Advantage Plan in 2027

Source Motley_fool

Key Points

  • Medicare's annual open enrollment period is about to begin.

  • During that time, you can switch to a different Medicare Advantage plan or dump Medicare Advantage altogether.

  • It could be worth making a switch to a new plan if your coverage has gotten worse and your costs have increased.

  • The $23,760 Social Security bonus most retirees completely overlook ›

If you've been enrolled in Medicare for quite some time, you may be aware that the program's annual open enrollment period is about to begin. Open enrollment runs from Oct. 15 through Dec. 7 each year. During that time, you can make changes to your Medicare coverage.

If you're enrolled in a Medicare Advantage plan, you have a few options. You can switch from one Advantage plan to another or ditch Medicare Advantage completely and move onto original Medicare. If you do the latter, you'll need to sign up for a Part D plan to get drug coverage.

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It's not uncommon for Medicare Advantage-age enrollees to switch plans. But here are a few reasons to consider dumping Medicare Advantage altogether.

1. You've lost access to your preferred providers

Medicare Advantage plans, unlike original Medicare, limit you to a specific provider network. You may get lucky and find plenty of providers in your plan's network who meet your needs. But if you've lost access to most of your preferred doctors and specialists and can't get that access back with another plan, you may want to reconsider whether Medicare Advantage is worth it.

If you switch to original Medicare, you don't have to worry about plan networks. You can see any doctor in the U.S. who accepts Medicare as insurance.

2. Your out-of-pocket costs keep rising

Many Medicare Advantage plans boast $0 premiums. That may sound nice, but that doesn't mean your total out-of-pocket costs are affordable. If you tend to use your insurance a lot, or you're managing a few conditions, you may find that you're tapping your retirement savings quite regularly to cover your bills.

If that's the case, you may be better off financially moving to original Medicare and pairing it with a Medigap plan. Medigap is supplemental insurance, and its purpose is to protect enrollees from exorbitant deductibles and coinsurance.

Medigap won't pay for services Medicare itself won't. But it could help you lower your costs overall.

Now one hiccup you might encounter is that you may be subject to strict underwriting for a Medigap plan due to not having signed up for supplemental insurance when you first enrolled in Medicare Part B. You'll need to look into your Medigap options before pursuing this strategy.

3. Your plan's benefits have shrunk

A big perk of enrolling in Medicare Advantage is getting access to benefits beyond what original Medicare covers. It's common for Medicare Advantage plans, for example, to offer additional benefits like dental cleanings, eye exams, and hearing aids, whereas original Medicare won't pay for any of these.

But if your Medicare Advantage plan benefits keep getting whittled down, and you're not seeing such great benefits in other plans, it could pay to switch to original Medicare and simply budget for the occasional dental cleaning or eye exam. Even if you have these services covered under a different Advantage plan, you could get stuck with strict service networks or high copays, making these benefits less valuable.

4. You're tired of prior authorization delays

Medicare Advantage plans are notorious for requiring prior authorization for certain care. Before you can undergo a costly diagnostic test, for example, you'll generally need to get prior approval, which could delay your care or even lead to a denial for the service you need.

If you're tired with that process, you may want to move to original Medicare. You may have better luck getting more expedited care.

5. You expect to start traveling more

As noted earlier, Medicare Advantage plans limit you to a specific provider network. If you expect to do a lot of traveling in the new year or split your time between two parts of the country, Medicare Advantage may not be right for you.

Out-of-network care can be very costly when you're enrolled in Medicare Advantage. Original Medicare gives you the freedom to see a doctor or seek care from anywhere in the U.S. as long as they take Medicare.

Medicare Advantage has its benefits, but that doesn't make it the right choice for you. As you enter open enrollment, consider whether it pays to keep Medicare Advantage or try original Medicare.

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Disclaimer: For information purposes only. Past performance is not indicative of future results.
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