A Medicare Part C plan, officially called Medicare Advantage, is a private insurance alternative to Original Medicare that bundles your Part A (hospital) and Part B (medical) coverage into a single plan. Most Medicare Advantage plans also include prescription drug coverage, and many add extras like dental, vision, and hearing benefits that Original Medicare doesn’t cover. About half of all Medicare beneficiaries are now enrolled in a Part C plan.
How Part C Differs From Original Medicare
Original Medicare is run directly by the federal government. You can see any doctor or hospital in the country that accepts Medicare, you typically don’t need referrals, and you pay 20% of the approved amount for most outpatient services after meeting your deductible. The biggest gap: there’s no yearly cap on what you spend out of pocket unless you buy a separate Medigap policy.
Medicare Advantage plans are offered by private insurers that contract with Medicare. You still have Medicare, but your coverage is managed through the private plan. The trade-off is straightforward. You gain a built-in out-of-pocket maximum and often get extra benefits, but you give up some flexibility in choosing providers. Most plans require you to use doctors within a network, and some require referrals to see specialists.
In 2025, Medicare Advantage plans can set their in-network out-of-pocket limit at up to $9,350, and plans that cover out-of-network care can set a combined limit of up to $14,000. The average in-network limit is closer to $5,320. Once you hit that ceiling, covered services cost you nothing for the rest of the year. Original Medicare has no such ceiling on its own.
One important restriction: if you’re in a Medicare Advantage plan, you cannot buy a Medigap supplemental policy to help cover your costs. You can, however, use coverage from a current or former employer, a union, or Medicaid if you qualify.
What Part C Covers
Every Medicare Advantage plan is required to cover everything Original Medicare covers. That includes hospital stays, doctor visits, lab tests, outpatient procedures, and preventive care. Plans can charge different copays or coinsurance for these services than what you’d pay under Original Medicare, but they can’t offer less coverage overall.
Where Part C gets interesting is the extras. Most plans bundle in prescription drug coverage (Part D), so you don’t need a separate drug plan or a separate premium for medications. As of recent years, 94% of Medicare Advantage enrollees were in a plan offering some dental coverage, and many plans also include routine vision exams, hearing aids, and fitness programs. These are benefits Original Medicare simply does not provide.
Types of Medicare Advantage Plans
Not all Part C plans work the same way. The type you choose determines how much freedom you have in picking providers.
- HMO (Health Maintenance Organization): You generally must use in-network doctors and hospitals for everything except emergencies and urgent care. You’ll usually need a primary care doctor and referrals to see specialists. Some HMO plans offer a “Point-of-Service” option that allows limited out-of-network care at a higher cost.
- PPO (Preferred Provider Organization): You can see any provider in or out of network without a referral, though out-of-network care costs more. PPOs offer more flexibility than HMOs but often come with higher premiums.
- PFFS (Private Fee-for-Service): You can visit any Medicare-approved provider who agrees to the plan’s payment terms. No referrals needed. These plans may or may not have a provider network.
- SNP (Special Needs Plan): Designed for people with specific chronic conditions, those who qualify for both Medicare and Medicaid, or those living in certain institutions. SNPs can be structured as HMOs or PPOs, and the rules follow accordingly.
Prescription Drug Rules
Most Medicare Advantage plans include drug coverage built in, meaning your Part A, Part B, and Part D benefits all come through one plan with one card. You don’t pay a separate Part D premium in most cases.
There’s an important enrollment rule to know. If you’re in an HMO or PPO Medicare Advantage plan and you try to join a separate standalone drug plan, you’ll be automatically disenrolled from your Advantage plan and returned to Original Medicare. The only plan types that allow a separate drug plan are Private Fee-for-Service plans without built-in Part D, Medical Savings Account plans, and certain employer-sponsored Medicare plans.
Who Can Enroll
To join a Medicare Advantage plan, you must be enrolled in both Medicare Part A and Part B, live in the plan’s service area, and be a U.S. citizen or lawfully present in the country. You’ll continue paying your monthly Part B premium. Some Advantage plans charge an additional monthly premium on top of that, while others have a $0 plan premium. A handful of plans even help cover part of your Part B premium.
When You Can Sign Up or Switch
The main window for joining, switching, or dropping a Medicare Advantage plan is the Annual Enrollment Period, which runs from October 15 through December 7 each year. Any changes you make take effect January 1.
If you’re already in a Medicare Advantage plan and want to make a change, there’s a second window: the Medicare Advantage Open Enrollment Period from January 1 through March 31. During this time, you can switch to a different Advantage plan or drop your plan and return to Original Medicare (and pick up a standalone Part D drug plan if needed). You can only make one change during this period.
Prior Authorization Requirements
One difference that catches people off guard is prior authorization. Medicare Advantage plans can require you to get approval before certain procedures, tests, or treatments are covered. Original Medicare rarely does this. The concern has been significant enough that federal regulators have tightened the rules. Plans are now required to use the same coverage standards as Original Medicare when deciding what’s medically necessary. Prior authorization approvals must remain valid for as long as a course of treatment is medically reasonable, so your plan can’t pull coverage mid-treatment. Emergency behavioral health services cannot be subject to prior authorization at all.
Each plan must also maintain a committee that reviews its prior authorization policies annually to make sure they align with Original Medicare’s coverage guidelines.
How Plan Quality Is Rated
Medicare assigns every Advantage plan a star rating from 1 to 5 stars based on dozens of quality measures. For plans that include drug coverage, ratings draw on up to 43 separate measures. These cover a wide range: cancer screenings, diabetes management, blood pressure control, how quickly members can get appointments, customer service quality, how often members choose to leave the plan, and how the plan handles appeals. Plans rated 4 stars or higher receive bonus payments from Medicare, which they often reinvest into lower premiums or richer benefits.
You can compare star ratings on Medicare.gov when shopping for plans. A consistently high-rated plan is a reasonable signal that members are getting timely, well-coordinated care.