How Medicare Advantage Keeps Health Care Affordable for Seniors

As health care costs continue to rise, affordability has become the defining issue for millions of Medicare beneficiaries. For more than 35 million Americans, Medicare Advantage provides the answer: with lower costs, predictable coverage, and meaningful financial protection.

Better Medicare Alliance’s latest State of Medicare Advantage report shows that beneficiaries enrolled in Medicare Advantage spend $3,486 less each year on premiums and out-of-pocket costs than those in traditional Fee-for-Service Medicare. These savings make it easier for seniors to afford their prescriptions and get the care they need without sacrificing everyday necessities. Meanwhile, seniors get more with Medicare Advantage, with better health outcomes and important health benefits like dental, vision, and hearing coverage — all under one affordable plan.

At Better Medicare Alliance, we hear from seniors every day about how hard it has become to afford health care. Many tell us they delay doctor visits, stretch medications, or worry about how they will cover basic health expenses alongside rising costs for food, housing, and utilities.

For Anita G. of Eaton, Colorado, Medicare Advantage doesn’t just cover visits to the doctor—it helps her afford daily essentials that keep her and her family healthy. “We use our Medicare Advantage plan to help with offsetting the cost of food, over-the-counter drugs, toothpaste, and more,” she said. “Without it, I don’t know what we’d do.”

Medicare Advantage also reduces the risk of financial strain. Beneficiaries in Medicare Advantage are 35% less likely to experience cost burden—defined as spending more than 20% of income on health care—than those in Fee-for-Service Medicare. That protection gives seniors greater confidence that their health care costs will remain manageable throughout the year.

Meanwhile, Medicare Advantage delivers for seniors managing serious and chronic conditions. Beneficiaries with conditions such as diabetes or hypertension have improved outcomes and spend less per year than those in Fee-for-Service Medicare. And for seniors with a current or previous cancer diagnosis, Medicare Advantage helps keep care within reach—providing critical financial protection for beneficiaries facing ongoing treatment and complex care needs.

Strong Affordability for Rural Seniors

Health care affordability is an urgent challenge for seniors in rural communities, where access to providers can be limited, and household budgets are often tighter. Findings in BMA’s Rural Health Databook confirm that Medicare Advantage delivers meaningful savings for these beneficiaries.

Among seniors living in rural areas, Medicare Advantage enrollees spend $1,474 less per year on premiums and out-of-pocket costs than those in Fee-for-Service Medicare. Even more striking, rural beneficiaries in Fee-for-Service Medicare are twice as likely to be burdened by health care costs as those enrolled in Medicare Advantage. In practical terms, that means Medicare Advantage enables more rural seniors to afford the care they need without sacrificing necessities like food, housing, or transportation.

Built-In Protections for Beneficiaries

Medicare Advantage is designed to protect seniors from unpredictable medical bills. Unlike traditional Medicare, all Medicare Advantage plans include an annual limit on out-of-pocket spending. Many plans also reduce cost sharing and offer benefits not available in Fee-for-Service Medicare — such as dental, vision, hearing, transportation, and in-home support — helping seniors manage both their health and their household budgets.

The Role of Policymaking

However, Medicare Advantage must be adequately funded to continue delivering affordable, high-quality care for seniors. The median maximum out-of-pocket (MOOP) in Medicare Advantage has jumped from $5,000 in 2024 to $5,900 in 2026 following several years of policy disruption and underinvestment in Medicare Advantage — a nearly $900 increase over just two years. At the same time, seniors will get less for their money, with fewer plan choices and reductions in key supplemental benefits such as transportation, meals, and over-the-counter support, according to one recent analysis. There will be 335 fewer individual Medicare Advantage plans available in 2026, continuing a trend of shrinking options for beneficiaries.

CMS plays an important role in establishing payment methodologies and program policies through its formal regulatory process, including the annual rate‑setting and rulemaking cycle. These regulatory decisions ultimately influence the benefits available to seniors, as well as the affordability of their coverage.

Meanwhile, legislation being considered on Capitol Hill could create further challenges to keeping costs low for seniors. The No UPCODE Act would cut Medicare Advantage by billions of dollars over 10 years, according to a recent independent analysis — resulting in reduced supplemental benefits and higher premiums for millions of seniors, with fewer enrolled in Medicare Advantage.

What This Means for Seniors

The data and the experiences of beneficiaries tell the same story: Medicare Advantage makes quality health care more affordable and accessible for seniors. Protecting and strengthening this program with adequate funding and targeted policymaking is essential to ensuring that millions of older Americans can continue to access the care they need without facing financial hardship.