Pensive Senior thinking about their options

If you’re enrolled in a Medicare Cost Plan, you may need to start looking into other coverage options. As of December 31, 2018, these plans have mainly been discontinued, and are only available to consumers in 11 states.1,2

Medicare Cost Plans are hybrid Medicare plans that share features from Medicare Advantage and Medigap supplemental insurance plans. They’re offered by private insurance companies.

Why Are Medicare Cost Plans not Renewing?

Medicare Cost Plan contracts were not renewed in areas where there were more than one Medicare Advantage plan available. If your organization decided to convert your plan to Medicare Advantage, it was able to continue as a Cost Plan through the end of the year.

What are the options for employer- or union-sponsored Cost Plans?

If you purchased your Cost Plan from your workplace or union, your plan may simply change to a similar Medicare Advantage plan. Also, you can disenroll from your Cost Plan at any time to return to Original Medicare.

However, you can only switch your Medicare Part D Prescription Drug coverage during the annual enrollment period.

Are insurance companies offering alternatives to Medicare Cost Plans?

Many recognized insurance companies have expanded their options in areas that previously had Medicare Cost Plans. During the annual enrollment period, it’s possible that you saw additional Medicare plans from existing companies and offerings for plans from companies that are new to your area.

Chances are, there will be several different options, including Medicare Advantage plans with $0 premiums. It could get confusing, so consulting with a licensed insurance agent can be helpful.

Switching to a Medicare Advantage Plan

Cost-conscious individuals with a Cost Plan may benefit by considering a Medicare Advantage Plan, also known as Medicare Part C. It includes all the benefits of Original Medicare and can also include extra features such as emergency care, wellness programs, Medicare Part D, as well as other benefits. The main difference from a Medicare Cost Plan is that you must use in-network providers for your care.

One benefit of Medicare Advantage plans is that they include out-of-pocket limits. Original Medicare does not include an out-of-pocket spending maximum. This means that your copays or coinsurance can continue to add up with no limit. A Medicare Advantage plan does include such a cap. Because private companies offer Medicare Advantage plans, CMS rules require an out-of-pocket limit for plans of $7,550.3 Some plans may offer even lower caps.

HealthMarkets can help make your Medicare Cost Plan switch easy

HealthMarkets can help you review your Medicare coverage options. Start comparing plans online today, or call (800) 488-7621 to speak with a licensed insurance agent.



1. “Importance Notice.” CMS. Retrieved from Accessed December 10, 2021. | 2. “What to know about Medicare cost plans.” Medical News Today. December 2020. Retrieved from | 3. “Medicare Advantage in 2021: Premiums, Cost Sharing, Out-of-Pocket Limits and Supplemental Benefits.” June 2021. KFF. Retrieved from

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