Another option for some Medicare beneficiaries who are looking for ways to lower their out-of-pocket costs is to enroll in a Medicare managed care plan under a program called Medicare Advantage (formerly known as Medicare + Choice, also known as Medicare Part C). These are private managed care plans that contract with the government to cover Medicare services and sometimes additional services, such as check-ups. Significantly, some Medicare Advantage plans include Medicare prescription drug coverage, (known as Medicare Advantage Prescription Drug Plans or MAPDs) and some do not. Medicare Advantage plans cannot turn you down or charge you more because of your health or your age. These plans must provide all of the benefits that traditional Medicare provides, but all plan options are not available everywhere or to everyone.

To be eligible for a Medicare Advantage plan, you must:
- Be enrolled in Medicare Part B and continue paying your Part B premium,
- Live in the plan’s service area,
- Not be receiving care from a certified Medicare hospice, and
- Not be diagnosed with permanent kidney failure.

You should carefully consider the pros and cons before enrolling in a Medicare managed care plan. Just like all other managed care plans, you will have limited coverage if you choose to get your healthcare from doctors, hospitals, and other providers NOT in the plan’s network. If you choose a Medicare HMO, you will receive no coverage for services obtained outside the network. If you are considering a managed care plan because your current doctor or hospital is in its network, keep in mind that these doctors and hospitals may not be able to provide you with the same services in a managed care plan as in traditional Medicare. Often, doctors must follow the managed care plan’s rules on care and obtain approval for referrals and costly services. Additionally, your doctor may leave the network at any time. Health plans have been known to leave the Medicare Advantage market, forcing members to choose different coverage. If you become dissatisfied with your Medicare managed care plan, or the plan makes changes, you can return to traditional Medicare. As of 2005, however, you are only able to make this switch during specific enrollment periods. Also, whenever you leave a managed care plan to return to traditional Medicare, you may have only a nlimited choice of Medigap plans available to you. Some plans offer a Preferred Provider Organization (PPO) option to Medicare beneficiaries, allowing members to choose care from out-of-network providers at an increased cost. When looking into this option, find out what extra premiums and fees you would be responsible for and what limits the health plan puts on out-of-network coverage.