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Which Medicare plan will save you the most money? It’s not always what you think
By Mark Pabst
Meet Bill.* Bill is getting ready to choose a Medicare plan. He’s been nursing bad knees, is taking daily medication to regulate his blood pressure, and sees a cardiologist to check on his heart health.
Let’s compare Bill’s health care costs over the next year between Original Medicare and a Medicare Advantage PPO plan with a premium. As you will see, the cost of Medicare can vary greatly based on the care you need and the coverage you choose.
It’s important to remember that everyone’s health is unique, so consider your specific care needs when deciding what type of coverage may work best for you. And plan availability and costs can vary based on where you live. So be sure to review the plans offered in your area.
Medicare road map: How to save money in the long run
Bill* is ready to sign up for a Medicare plan and must compare his options. Which saves him more money?
Total cost summary
Original Medicare + Part D Rx plan
Annual premium costs $2,357
Annual medical/dental/vision costs $4,453
Annual prescription costs $360
Annual gym membership costs $600
Annual total cost $7,770
Medicare Advantage plan1
Annual premium costs $2,195
Annual medical/dental/vision costs $2,567
Annual prescription costs $0
Annual gym membership costs $0
Annual total cost $4,762
The total cost breakdown
Premiums
Bill pays an additional monthly premium for a prescription drug plan on top of his monthly Part B premium for Original Medicare. If he chooses Medicare Advantage (MA), he pays an additional monthly premium for his particular MA plan
Original Medicare + Part D Rx plan
Medicare Part B premiums $1,979
($164.90 x 12)
Prescription drug plan premiums $378
($31.50 x 12)
Premiums subtotal $2,357
Medicare Advantage plan1
Medicare Part B premiums $1,979
($164.90 x 12)
Medicare Advantage plan premiums $216
($18 x 12)
Premiums subtotal $2,195
Medical costs2
Bill meets his Original Medicare deductible and pays 20% coinsurance. With the Medicare Advantage plan that Bill chose, he has predictable copays for each service. (Costs shown in both columns are for the same services.)
Original Medicare + Part D Rx plan
Overnight hospital stay $1,578
Cardiologist (4 visits) $200
($250 x 4 = $1,000 @ 20%)
Orthopedic surgeon (5 visits) $300
($300 x 5 = $1,500 @ 20%)
X-rays (both knees) $40
($100 x 2 = $200 @ 20%)
Outpatient hospital knee surgery (arthroscopy with meniscus repair on each knee) $1,105
($2,763 x 2= $5,526 @ 20%)
Physical therapy (3 visits a week for 8 weeks) $480
($100 x 24 = $2,400 @ 20%)
Medical costs subtotal $3,703
Medicare Advantage plan1
Overnight hospital stay $312
Cardiologist (4 visits) $140
($35 x 4)
Orthopedic surgeon (5 visits) $175
($35 x 5)
X-rays (both knees) $30
($15 x 2)
Outpatient hospital knee surgery (arthroscopy with meniscus repair on each knee) $850
($425 x 2)
Physical therapy (3 visits a week for 8 weeks) $960
($40 x 24)
Medical costs subtotal $2,467
Prescription costs
Bill takes two prescription medications daily. He fills both prescriptions monthly.
Original Medicare + Part D Rx plan
Two monthly prescriptions @ $15 each
$15 each
($15 x 2 x 12= 360)
$360
Prescription costs subtotal: $360
(Cost estimates are based on prescriptions received at a preferred pharmacy3)
Medicare Advantage plan1
Generic drug (two monthly prescriptions @ $0 copays)
$0 copays
($0 x 2 x 12= 0)
$0 in copays
Prescription costs subtotal: $0
(Cost estimates are based on prescriptions received at a preferred pharmacy4)
Dental costs
Bill needs some dental work. Original Medicare doesn’t include comprehensive dental coverage. His MA plan provides an allowance of $500 to spend on dental services.
Original Medicare + Part D Rx plan
Extraction $600
Dental costs subtotal: $600
Medicare Advantage plan1
Extraction $600
$600-$500 dental allowance
Dental costs subtotal: $100
Fitness costs
Bill’s Medicare Advantage plan includes a monthly gym membership. Original Medicare does not.
Original Medicare + Part D Rx plan
Gym membership $505
($50 x 12= 600)
Fitness costs subtotal: $600
Medicare Advantage plan1
Gym membership
$0
Fitness costs subtotal: $0
Glasses costs
Bill wears glasses and tries to keep his prescription up to date. His Medicare Advantage plan includes an eyewear benefit. Original Medicare does not.
Original Medicare + Part D Rx plan
Glasses $150
Glasses costs subtotal: $150
Medicare Advantage plan1
Glasses $0
Glasses costs subtotal: $0
*Bill is a fictional character whose story is being used for illustrative purposes only.
1 All Original Medicare figures are for the 2023 plan year; costs usually increase annually. Costs are based on a fictional composite plan with average costs. Medicare Advantage plan costs vary depending on your income and location; copays and deductibles also vary. Medicare Advantage plans may include dental and vision benefits at no additional cost.
2 U.S. Centers for Medicare & Medicaid Services. Planning an outpatient procedure? Procedures Price Lookup. Medicare.gov. Available at: https://www.medicare.gov/procedure-price-lookup/. Accessed March 3, 2023.
3Figures cited from Medicare Costs Estimator Tool. Available at: https://www.medicare.gov/oopc/.
5 Strong Home Gym. “Average Gym Membership Costs $50.03 Per Month.” From https://stronghomegym.com/average-gym-membership-costs/. Accessed March 21, 2023.
Medicare road map: How to save money in the long run
Bill* is ready to sign up for a Medicare plan and must compare his options. Which saves him more money?
Total cost summary
Original Medicare + Part D Rx plan
Annual premium costs $2,357
Annual medical/dental/vision costs $4,453
Annual prescription costs $360
Annual gym membership costs $600
Annual total cost $7,770
Medicare Advantage plan1
Annual premium costs $2,195
Annual medical/dental/vision costs $2,567
Annual prescription costs $0
Annual gym membership costs $0
Annual total cost $4,762
The total cost breakdown
Premiums
Bill pays an additional monthly premium for a prescription drug plan on top of his monthly Part B premium for Original Medicare. If he chooses Medicare Advantage (MA), he pays an additional monthly premium for his particular MA plan
Original Medicare + Part D Rx plan
Medicare Part B premiums $1,979
($164.90 x 12)
Prescription drug plan premiums $378
($31.50 x 12)
Premiums subtotal $2,357
Medicare Advantage plan1
Medicare Part B premiums $1,979
($164.90 x 12)
Medicare Advantage plan premiums $216
($18 x 12)
Premiums subtotal $2,195
Medical costs2
Bill meets his Original Medicare deductible and pays 20% coinsurance. With the Medicare Advantage plan that Bill chose, he has predictable copays for each service. (Costs shown in both columns are for the same services.)
Original Medicare + Part D Rx plan
Overnight hospital stay $1,578
Cardiologist (4 visits) $200
($250 x 4 = $1,000 @ 20%)
Orthopedic surgeon (5 visits) $300
($300 x 5 = $1,500 @ 20%)
X-rays (both knees) $40
($100 x 2 = $200 @ 20%)
Outpatient hospital knee surgery (arthroscopy with meniscus repair on each knee) $1,105
($2,763 x 2= $5,526 @ 20%)
Physical therapy (3 visits a week for 8 weeks) $480
($100 x 24 = $2,400 @ 20%)
Medical costs subtotal $3,703
Medicare Advantage plan1
Overnight hospital stay $312
Cardiologist (4 visits) $140
($35 x 4)
Orthopedic surgeon (5 visits) $175
($35 x 5)
X-rays (both knees) $30
($15 x 2)
Outpatient hospital knee surgery (arthroscopy with meniscus repair on each knee) $850
($425 x 2)
Physical therapy (3 visits a week for 8 weeks) $960
($40 x 24)
Medical costs subtotal $2,467
Prescription costs
Bill takes two prescription medications daily. He fills both prescriptions monthly.
Original Medicare + Part D Rx plan
Two monthly prescriptions @ $15 each)
$15 each
($15 x 2 x 12= 360
$360
Prescription costs subtotal: $360
(Cost estimates are based on prescriptions received at a preferred pharmacy3)
Medicare Advantage plan1
Generic drug (two monthly prescriptions @ $0 copays)
$0 copays
($0 x 2 x 12= 0
$0 in copays
Prescription costs subtotal: $0
(Cost estimates are based on prescriptions received at a preferred pharmacy4)
Dental costs
Bill needs some dental work. Original Medicare doesn’t include comprehensive dental coverage. His MA plan provides an allowance of $500 to spend on dental services.
Original Medicare + Part D Rx plan
Extraction $600
Dental costs subtotal: $600
Medicare Advantage plan1
Extraction $600
$600-$500 dental allowance
Dental costs subtotal: $100
Fitness costs
Bill’s Medicare Advantage plan includes a monthly gym membership. Original Medicare does not.
Original Medicare + Part D Rx plan
Gym membership $505
($50 x 12= 600
Fitness costs subtotal: $600
Medicare Advantage plan1
Gym membership
$0
Fitness costs subtotal: $0
Glasses costs
Bill wears glasses and tries to keep his prescription up to date. His Medicare Advantage plan includes an eyewear benefit. Original Medicare does not.
Original Medicare + Part D Rx plan
Glasses $150
Glasses costs subtotal: $150
Medicare Advantage plan1
Glasses $0
Glasses costs subtotal: $0
*Bill is a fictional character whose story is being used for illustrative purposes only.
1 All Original Medicare figures are for the 2023 plan year; costs usually increase annually. Costs are based on a fictional composite plan with average costs. Medicare Advantage plan costs vary depending on your income and location; copays and deductibles also vary. Medicare Advantage plans may include dental and vision benefits at no additional cost.
2 U.S. Centers for Medicare & Medicaid Services. Planning an outpatient procedure? Procedures Price Lookup. Medicare.gov. Available at: https://www.medicare.gov/procedure-price-lookup/. Accessed March 3, 2023.
3 Figures cited from Medicare Costs Estimator Tool. Available at: https://www.medicare.gov/oopc/.
5 Strong Home Gym. “Average Gym Membership Costs $50.03 Per Month.” From https://stronghomegym.com/average-gym-membership-costs/. Accessed March 21, 2023.
Before choosing your own plan, it’s important to do your research. Aetna Medicare’s website and the Medicare Plan Finder are good places to start.
*Bill is a fictional character whose story is being used for illustrative purposes only.
About the author
Mark Pabst has worked as a writer and researcher in the health care field for almost two decades. When not writing about health he tries to stay healthy through activities like hiking, climbing and paddling in the far flung corners of his native state of California. However, despite his best efforts he still has a few unhealthy habits he can’t shake, most notably a weakness for jelly donuts.
Disclaimer
Plan features and availability may vary by service area. The Aetna Medicare pharmacy network includes limited lower cost, preferred pharmacies in: Suburban Arizona, Suburban Illinois, Urban Kansas, Rural Michigan, Urban Michigan, Urban Missouri, Rural North Dakota, Suburban West Virginia. The lower costs advertised in our plan materials for these pharmacies may not be available at the pharmacy you use. For up-to-date information about our network pharmacies, including whether there are any lower-cost preferred pharmacies in your area, members please call the number on your ID card, non-members please call 1-855-338-7027 ${tty} or consult the online pharmacy directory at http://www.aetnamedicare.com/pharmacyhelp.