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How Much Does a Typical Medicare Advantage Plan Cost?

Page Reviewed / Updated - August 21, 2020

In 2019, seniors paid an average of $29 a month for their Medicare Advantage plans. Available plans vary by state, and monthly premiums vary too: Some plans pay for a person's Medicare Part B premiums, while other plans include extra benefits, like dental and vision coverage. Usually, seniors can choose at least one plan with no monthly premium costs at all, although zero-premium plans often carry a higher deductible.

Medicare Advantage Plans Defined

Also known as Medicare Part C, government-authorized Medicare Advantage Plans provide all the coverage of Original Medicare, as well as additional benefits. Many plans eliminate the need for Medicare Part D because they include prescription drug coverage. Seniors pay a premium for their Medicare Advantage Plans every month. They also pay a deductible on covered services, and coinsurance after they've met the deductible.

Benefits of a Medicare Advantage Plan

Many individuals beyond retirement age opt for Medicare Advantage Plans because they reduce annual out-of-pocket health care costs. They feel familiar, too, because they're essentially the same as other health insurance plans. Seniors can choose plans with dental and vision coverage, and they can also pick from a wide range of deductible and coinsurance options.

Some Medicare Advantage plans pay for a person's Medicare Part B benefits automatically. While they seem more expensive at first glance, these plans make life easier because policyholders no longer have to remember to send a separate check to the government every month.

Medicare Part C Provider Networks

There are three main types of Medicare Advantage Plan provider networks: Health Maintenance Organizations (HMOs), local Preferred Provider Organizations (PPO) and regional Preferred Provider Organizations. Some people opt for Private Fee-for-Service (PFFS) plans or Medicare Special Needs Plans (SNPs), which provide a different range of benefits.

With an average $23 monthly premium, HMO plans were the cheapest option for seniors in 2019. Local PPOs were next, with an average $39 monthly premium, followed by regional PPOs, which had an average monthly premium of $44.

Medicare Premium Considerations

Most retirees qualify for premium-free Medicare Part A. Seniors who paid Medicare taxes for less than 40 quarters aren't automatically eligible to receive free Medicare Part A, but they can buy into the plan by paying a monthly fee. If they paid Medicare taxes for less than 30 quarters, they pay a standard $448 monthly Medicare Part A premium. If they paid Medicare taxes for between 30 and 39 quarters, the Medicare Part A premium goes down to $252 a month. Some Medicare Part C plans pay these premiums on a person's behalf.

The standard Medicare Part B premium for all people is $144.60 per month, but it can be more depending on a person's income. Seniors don't need to buy Medicare Part B if they decide to opt for Original Medicare; however if they want a Medicare Advantage Plan, they usually do need to sign up for Medicare Part B. Again, some Medicare Advantage Plans pay Medicare Part B costs to the government on a policyholder's behalf.