Medicare Alternatives often cover more services than that of Original Medicare. Income and assets influence coverage options.
Most Americans enroll in Parts A & B when they turn 65. But some people need benefits that Parts A & B won’t cover.
If this sounds familiar, there’s light at the end of the tunnel. Many private insurance companies work with Medicare to provide more options.
Finding Alternatives to Medicare
Medicare pays for a wide range of healthcare costs. But, many services Medicare still fails to include.
For example, you must pay the full price of medications, routine dental, hearing, and vision services unless you have a separate policy.
Even with benefits, you may still have deductibles to meet and co-payments to pay. Gaps in coverage can become exhausting.
You may choose to buy extra insurance to help pay for some out-of-pocket medical costs. But, there are variations in benefits.
The best plan for you depends on your healthcare needs, budget, and service location.
Medicare Private Insurance
There are different types of Medicare insurance. Each plan type comes with varying levels of coverage and costs.
Insurance options include prescription plans, Medicare Advantage, Medigap, and qualifying employer health insurance.
Traditional Medicare vs. Medicare Advantage
Private health insurance includes the Medicare Advantage plan. The law requires Advantage plans to cover any service that Part A or B covers.
Although, most Advantage plans include services that Medicare doesn’t cover. Such as Part D or a gym membership.
Medicare doesn’t include drugs, whereas some Advantage plans include Part D.
Medicare vs. Private Insurance
Private insurance is an alternative option for Medicare. Independent companies may increase your plan premium amount based on where you live, your age, tobacco use, and at times, pre-existing health conditions.
Premium increases are sometimes three times higher for older individuals than for younger people. Medicare beneficiaries don’t pay a premium payment for Part A.
Most Part B beneficiaries have a fixed premium. The only exception is if Medicare changes the Part B premium cost from year to year.
Some private insurance plans also cover your dependents, such as children or spouses. The Medicare program is individual coverage.
Most people only qualify for Medicare through age or disability. In some situations, your spouse may help your Medicare eligibility.
When it comes to benefits, private plans may offer more coverage. Medicare offers decent coverage, but there are still many gaps.
For example, any medications taken at home aren’t paid for by either Part A or B. You must get a Part D plan to get help paying for medications.
Part A only pays for drugs when you get them during an inpatient hospital stay. Then, Part B may pay for medications like infusions or injections when you get them during an outpatient visit.
Medicare vs. Health Insurance
Making the Medicare transition can be daunting at first. You may have many adjustments to make.
Health insurance likely paid for your medical expenses and all or some of your prescriptions in the past.
While Part A covers hospital bills, Part B covers many medical services – neither pays for your upcoming trip to the dentist.
Medicare doesn’t have an annual cap on the amount you pay for healthcare. Most insurance plans have a maximum out-of-pocket.
Medicare vs. Employer Insurance
You have the choice to keep your employer’s group health insurance plan if you’re still working when first becoming Medicare eligible.
Medicare works with employer health insurance depending on the size of your employer’s company.
If you’re working for a company with 20+ employees, your group coverage is primary, and Medicare benefits are secondary. The coordination of benefits determines which plan pays first.
Small business group insurance is for companies with less than 20 employees. If you work for a smaller organization – it’s smart to join Part A & B during your initial enrollment period. Small group plans can reject to pay your medical claims.
Even if you have credible employer health insurance, join Part A when you first become eligible. If you paid into Medicare taxes during your working years – there’s a $0 premium cost.
Part A keeps out-of-pocket medical expenses lower during any hospital stays.
Compare both Medigap and Part B premiums with your employer’s deductions from your paycheck. Consider medication costs as well as deductibles and co-payments.
If Medicare plus Medigap offers lower prices – dropping your employer insurance may make sense.
Alternatives to Medicare Part B
Once eligible for Medicare, there aren’t many alternatives to Part B without being penalized. Companies offer health sharing plans that allow members to share medical claim expenses.
Yet, health sharing plans don’t prevent potential penalties if you decide to enroll later.
Advantage plans are alternatives to Part B in the sense they replace Medicare. To buy an Advantage plan, you need Parts A and B.
The other choice is to keep working, providing your employer has more than 20 employees. In this case, you should compare benefits to determine if the employer coverage is better.
Medicare Part B vs. Private Insurance
Let’s breakdown the differences between Part B and private insurance and what happens when you have both.
Part B is insurance for most medical outpatient services or supplies that are necessary for treating your health condition(s).
Thanks to the Affordable Care Act, Part B may include ambulance and preventive services, outpatient care, doctors’ visits, and durable medical equipment. And, even though Medicare covers a wide range of medical costs, it doesn’t pay for everything.
What makes private insurance different? Well, you don’t have to be 65+ or have a disability — for example, employer health insurance.
Medicare-eligible individuals may use both Part B and any other private insurance to cover medical bills. Anytime you have two health coverage policies; one is primary, and the other is secondary.
Many private insurance companies have contracts with Medicare to provide alternatives or additional benefits for comprehensive coverage.
You may know these alternatives as Supplement or Advantage Plans. Benefits and costs may vary depending on the company and plan type.
Alternatives to Medicare Part D
Enrolling in Part D is not required by Medicare. Although, if you don’t have adequate drug coverage for more than 63 consecutive days following initial Medicare eligibility – you may face late-enrollment fees.
Many other drug coverage plans are acceptable to use alongside Medicare.
Medicare Part D vs. Private Insurance
Part D is coverage for prescriptions. To get Part D, you may buy a stand-alone drug plan or a Medicare Advantage Prescription Drug plan.
Either way, you must buy Part D from a Medicare-approved private insurance provider
Medicare Gap Insurance vs. Medicare Advantage
Supplement insurance and Medicare Advantage plans are both offered by private companies to help pay otherwise out-of-pocket medical costs.
Each program has different advantages and multiple plan types; costs and levels of benefits vary depending on the carrier and type of policy.
Medicare Gap insurance is Supplement Insurance. Medigap plans reduce medical costs for coinsurance, deductibles, co-payments, and more.
There are currently ten letter-name Medigap plans available in 47 states. Each Medigap letter plan A-N offers a different level of coverage.
The retired Plans E, H, I, and J are no longer available to any new Medicare enrollees. Likewise, if your eligibility begins on or after January 1, 2020 – Medigap Plan F and Plan C are also unavailable.
Premium costs may fluctuate, but coverage remains consistent for each letter plan – regardless of the insurance carrier. Other factors like where you live and your age may also impact the cost of your Medigap policy.
While most Advantage plans cover services exceeding Parts A and B, they must offer at least the same benefits as Medicare.
Extra benefits like prescription drug plans and include routine vision, dental, and hearing coverage.
Popular Advantage plan types include:
- Special Needs Plans (SNPs)
- Private Fee-for-Service (PFFS)
- Preferred Provider Organizations (PPOs)
- Health Maintenance Organization (HMOs)
Alternatives to Medicare Advantage Plans
Advantage plans don’t offer the same freedom of healthcare choice that Medicare with a Medigap policy provides. Advantage plans have limitations and restrictions, including requiring you to see only their network of providers.
Not to worry, there are alternatives to Medicare Advantage plans. During the Annual Enrollment Period, you can enroll in a Medigap plan. Or, if you are new to Medicare, you may be eligible for the Medicare Supplement Open Enrollment Period.
But, your Medigap rate may be higher if you don’t join when first qualifying for Medicare. We can help you find the most beneficial plan for your healthcare needs.
Give one of our agents a call at the number above or fill out our online rate comparison form and get your free quote today!