The Biggest Medicare Advantage Mistakes Retirees Make

There's a reason some retirees opt to sign up for Medicare Advantage instead of sticking to original Medicare. Medicare Advantage plans commonly offer coverage beyond what original Medicare pays for. And Advantage plans also put caps on annual out-of-pocket spending, allowing retirees to better budget for healthcare bills.

But if you're inclined to sign up for Medicare Advantage, there are certain mistakes you might fall victim to. Here are three common ones you should make every effort to avoid.

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1. Choosing a plan based on premium costs alone

Many Medicare Advantage plans have low monthly premiums. Some even have $0 premiums. If you're a retiree on a fixed income, those low-cost plans can be tempting. But it's a mistake to choose your Medicare Advantage coverage based on premium costs alone.

The reason? Premiums are only a piece of the total puzzle. You may also be on the hook for deductibles, co-pays, and other costs that can add up quickly. So when comparing your plan choices, pay attention to total costs -- not just premiums.

2. Not paying attention to provider networks

Unlike original Medicare, which lets you see any provider that accepts Medicare, Medicare Advantage plans typically require you to use a specific network of doctors and hospitals. If you go outside of your plan's network, you could face higher costs or, in some cases, no coverage at all.

Before you choose a Medicare Advantage plan, verify that your preferred doctors are in network. Otherwise, go in knowing you may need to give new doctors a try.

Also keep in mind that if you plan to split your time between two parts of the country (say, live in New York during the warm-weather months and spend December through March in Florida), a Medicare Advantage plan may not work well for you. You might struggle to get care outside of your primary geographic area.

3. Not checking drug formularies every year

You might initially choose your Medicare Advantage plan based on favorable coverage for the medications you take. But plan formularies can change from year to year.

Review your plan's formulary each year. It's also important to shop around for different plans each year in case your prescription needs happen to change.

While signing up for Medicare Advantage over original Medicare could benefit you in many ways, it's important to avoid these pitfalls. They could result in higher costs than expected and coverage you aren't happy with.

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