What Is Medicare Advantage (Part C)?

More than half of all Medicare beneficiaries are now enrolled in Medicare Advantage — yet many of them don't fully understand what they've signed up for, or what their rights are when a claim is denied. If you're on Medicare Advantage, or helping a parent navigate it, this guide covers what you need to know.

What Is Medicare Advantage?

Medicare Advantage, also known as Part C, is a program that allows Medicare beneficiaries to receive their Medicare benefits through a private health insurance plan rather than through original Medicare (Parts A and B). The federal government pays private insurers a fixed amount per enrollee, and the insurer then provides at least the same level of coverage as original Medicare — often with additional benefits like dental, vision, and hearing.

Medicare Advantage plans come in several types:

• HMO plans: Require in-network care and PCP referrals
• PPO plans: Allow out-of-network care at higher cost
• PFFS plans (Private Fee-for-Service): Allow any provider who accepts the plan's terms
• SNP plans (Special Needs Plans): Designed for people with specific conditions or dual Medicare/Medicaid eligibility
• HMO-POS plans: HMO with a point-of-service out-of-network option

What Medicare Advantage Covers

At a minimum, every Medicare Advantage plan must cover everything that original Medicare covers, including:

• Hospital care (Part A)
• Medical care (Part B)
• Emergency and urgently needed care anywhere in the US
• Dialysis services

Most plans also include Part D prescription drug coverage (MA-PD plans) and additional benefits. However, the way these services are delivered — and the rules for accessing them — can differ significantly from original Medicare.

The Prior Authorization Denied: How to Appeal" class="auto-link">Prior Authorization Problem

This is where Medicare Advantage departs dramatically from original Medicare. Original Medicare generally does not require prior authorization for most services. Medicare Advantage plans, as private insurers, can impose their own prior authorization requirements.

The result: Medicare Advantage plans deny claims and prior authorization requests at significantly higher rates than original Medicare. A 2022 HHS Office of Inspector General report found that Medicare Advantage plans denied 13% of prior authorization requests that met Medicare coverage rules — meaning the service would have been covered under original Medicare, but was denied by the private plan.

Common services requiring prior authorization in Medicare Advantage:

• Post-acute care (skilled nursing facilities, home health, inpatient rehab)
• Durable medical equipment
• Specialty drugs
• Certain imaging and diagnostic services
• Elective surgeries

Common Medicare Advantage Denial Reasons

1. Prior authorization denied. The plan determines the service isn't medically necessary based on its own clinical criteria, which may be stricter than Medicare's coverage rules.

2. Out-of-network denial. If you're in an HMO-type Advantage plan and saw an out-of-network provider for non-emergency care, the plan will not cover it.

3. Post-acute care discharge timing. Plans frequently try to discharge patients from skilled nursing facilities earlier than is medically appropriate. This is a common and serious abuse of prior authorization authority.

4. Step therapy requirements. For certain drugs, the plan requires you to try a cheaper medication first before authorizing the one your doctor prescribed.

5. Claim coding issues. Administrative errors in billing can trigger automatic denials.

Your Appeal Rights Under Medicare Advantage

Medicare Advantage has a specific, federally mandated appeal process — and the timelines are strict.

Level 1: Plan Reconsideration. File within 60 days of the denial notice. The plan must respond within 30 days for standard requests, 72 hours for expedited requests. For pre-service denials, file before the service if possible.

Level 2: IRE (Independent Review Entity). If the plan upholds its denial, the case is automatically forwarded to a CMS-contracted IRE. You don't have to do anything extra to trigger this. The IRE has the same timeframe to respond.

Level 3: ALJ Hearing. If the IRE upholds the denial and the amount in dispute is at least $190 (2025 threshold), you can request a hearing before an Administrative Law Judge.

Level 4: Medicare Appeals Council. If the ALJ rules against you, you can appeal to the Medicare Appeals Council.

Level 5: Federal District Court. Final escalation — requires the amount in dispute to meet a statutory minimum.

Expedited Appeals: If your health condition requires a faster decision, request an expedited appeal. The plan must decide within 72 hours for prior authorization and 24 hours for expedited plan reconsideration of a service denial.

The 2-Midnight Rule and SNF Denials

One of the most contested areas in Medicare Advantage is post-acute care. Under Medicare's 2-midnight rule, if a doctor expects you to need hospital care spanning at least two midnights, you should be admitted as an inpatient. Medicare Advantage plans sometimes pressure hospitals to keep patients in "observation status" instead, which affects your subsequent skilled nursing facility coverage (SNF coverage requires a prior 3-day inpatient stay).

If you're facing an SNF denial or a discharge you believe is premature, file an immediate expedited appeal. A Quality Improvement Organization (QIO) can review your case within days.

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Related Reading:

• How to Write an Insurance Appeal Letter
• What Is Medical Necessity?
• Internal vs External Insurance Appeal