Medicare Advantage vs Medicare Supplements

Knowing the differences between Medicare Advantage vs Medicare Supplements is crucial regarding your healthcare coverage benefits.

Many people are aware that Medicare alone won’t cover all your medical costs. To close these gaps in coverage, most purchase additional supplement insurance.

When comparing Medicare Advantage vs Medicare Supplement plans, both will reduce your total costs that you otherwise would end up spending out of pocket. Nobody wants to have to worry about deductibles and coinsurance.

Medicare Advantage vs Medicare Supplements (Medigap)

Even though both of these policies will save you from out of pocket costs, they work differently.

With Medicare Supplements, you keep your Original Medicare. After Medicare pays its share of your medical costs, your Medigap plan will pay the remainder. They are secondary insurance to Medicare.

With Medicare Advantage plans, you no longer have Original Medicare. Your benefits no longer come from Medicare. You must use the advantage plans provider network, except for emergencies.

Let’s review both of these plans in detail.

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Key Features of Medicare Supplement Plans

• Predictable Costs
• No Network Restrictions
• Standardized Benefits
• No Referrals Necessary
• Coverage Anywhere in the US
• Foreign Travel Benefits
• Covers Deductible and Coinsurance
• Flexible Plan Options
• Spouse Discount Available
• No Claims to File
• Guaranteed Renewable
• Enroll at Anytime

Predictable Costs

As long as Medicare pays it, your Medigap will pick up the rest. You’ll always know what your out of pocket costs will be. Depending on the letter plan you choose, you may have zero out of pocket costs.

No Network Restrictions

Any doctor that accepts Medicare will accept your Medigap plan. There are no network restrictions.

Standardized Benefits

All benefits are standardized. Meaning that regardless of the carrier you choose, the benefits will be the same.

No Referrals Needed

You can see any specialist without having to get a referral from your primary doctor.

Covered Anywhere in the US

Your benefits will travel across state lines, so you’ll always be covered no matter where you go in the United States.

Foreign Travel Benefits

Depending on your letter plan, you’ll have coverage for emergencies when traveling abroad.

Covers Deductible and Coinsurance

Medigap will cover the remaining 20% coinsurance left under Part B. Some letter plans also include Part A & Part B deductible as well.

Flexible Plan Options

With multiple letter plans to choose from, you can personalize your benefits to fit your healthcare needs and budget.

Spouse Discounts Available

Many carriers offer spouse discounts, as well as household discounts.

No Claims to File

There are no claims for you to file, your supplement carrier will inform Medicare that you have enrolled in a Medigap plan. Going forward, Medicare will bill the remaining balance to the supplement carrier.

Guaranteed Renewable

Your coverage is guaranteed and will not change. Meaning that as long as you continue to pay the monthly premiums, a carrier must continue coverage.

Enroll at Anytime

You can enroll in a Medigap plan at any time. As long as you join during your open enrollment window, you won’t have to answer health questions. If you have a pre-existing condition, there are no waiting periods. If you wait to enroll outside of your open enrollment, you’ll have to answer some health questions.

Due to these plans giving you more flexibility, they come with higher premiums compared to Medicare Advantage plans. Depending on the letter plan you choose, your age, gender, and state you live in, the cost for someone turning 65 can be anywhere between $90-$160.

Key Features of Medicare Advantage Plans

• All-in-One Plan
• Only Use MA Card at Doctors
• Limited Value Added Services
• Requires Active Part A & B
• Low-to-No Month Premium
• Unpredictable Costs
• Network Restrictions
• Referrals Necessary in Most Cases
• Nationwide Emergency Coverage
• No Coverage Outside US
• Can Be Deducted from Social Security

All-In-One Plan

Medicare Advantage Plans sometimes include benefits for dental, vision, hearing,  and prescription medications. Since these plans include so many “extra” benefits, it’s easy to see why people call it an all in one plan.

Only Use MA Card At Doctors

When you have an MA policy, the coverage replaces your Red, White, and Blue card. So, when visiting the doctor, you’ll only need the Medicare Advantage insurance card.

The MA card tells doctors what your costs will be, the insurance company will determine the prices instead of Medicare. You need to use an in-network doctor to avoid paying more than necessary.

Limited Value Added Service

A plan isn’t good just because it includes dental, vision, and hearing; the benefits you get aren’t everything you hope for, mostly it’s only routine services. The same kind of services you can find on Groupon for Dental and Vision.

If you want a plan for serious dental care, enroll in a stand-alone dental plan; MA isn’t the answer for your root canal.

Requires Active Part A & B

You must have Part A and B to enroll in an MA plan. When you pay the Part B premium a portion of those funds goes to the insurance company that handles your claim.

The MA plan will be the company in charge of your claims, instead of the federal government program.

Low-to-No Month Premium

Most advantage plans have a low or $0 premium. The low premium can appeal to many people across America, especially seniors with a low income.

Just because a plan has a low premium doesn’t mean it’s the best policy, these plans have high out of pocket costs on the back end

Unpredictable Costs

If you see a doctor outside the network, the cost for you is likely going to be 40% on a PPO or 100% with an HMO. When you pay out of pocket, the Maximum out of pockets isn’t relevant anymore; you can pay an endless amount in healthcare bills.

Network Restrictions

You must stick to the plan’s network of providers. You’ll pay more if you use out of network doctors and hospitals.

Always check with your doctor to see if they are in the plan’s network. When skipping this step, most new enrollees find that their doctor does not accept these plans.

HMOs are known for having a minimal list of doctors.

Your Medicare Advantage plan will pay your medical bills, not Medicare. Even though you still must continue paying your Part B premium.

Referrals Necessary in Most Cases

Forget going straight to the pain management doctor on the 1st of the year, you need a referral with most MA plans. This can be a waste of time, money, and resources.

Nationwide Emergency Coverage

Emergency coverage is not world-wide on an MA plan; however, you can go to any hospital in emergency situations.

No Coverage Outside US

MA plans give you no coverage outside the United States.

Can Be Deducted from Social Security

You can choose to have the premium for MA plans deducted from your Social Security check. There are other payment options.

If your plan has a $0 premium you still must select a payment method.

Check Your Plans Drug Formulary

Most plans include prescription drug coverage, but not all. Always check that your medications are covered in the plans built-in drug formulary.

Many who newly enroll don’t check this and end up being forced to stick with the policy they chose even though it doesn’t cover their vital medications.

Specific Enrollment Periods

Advantage plans have specific enrollment periods. Therefore, once you enroll in a program, you could be stuck with it until the end of the year.

So, if the plan you chose doesn’t include your medications and your doctor is not in their network, you have to keep that plan until December 31st. You can only change in the middle of the year if your eligible for a particular election period.

Out-Of-Pocket Maximum is High

The current out of pocket maximum for 2019 is $6,700. For many retirees, this is a lot of money. Most don’t reach this limit, but if you get a severe illness or accident, you can enter it fast.

If you have enough savings in your retirement plan to cover this, then an advantage plan may work for you. If not, then a Medigap plan is the safer alternative.

There are a variety of plans available — all offer at least the same basic coverage as Original Medicare. There may be a wide range of premium prices, deductibles, and co-pays, but some coverage is better than no coverage.

Some plans, in some areas, may include vision, hearing, or dental coverage. However, routine coverage is generally all that is available, so don’t expect denture coverage through Part C.

Switching from Medicare Advantage to Medigap

Most assume it’s safe to go with the cheaper alternative out of the gate, then change when they need better coverage. With Medicare, this doesn’t usually work.

Once you leave a Medigap plan and switch to a Medicare Advantage plan, you may not be able to go back to your Medigap plan.

Since your one-time enrollment window has most likely passed, you’ll have to go through medical underwriting to be accepted back into a plan.

There are a few exceptions to this, let’s review them.

Trial Period

If you choose to dis-enroll and go back to Original Medicare within the first 12 months of your plan starting, you can re-enroll into your Medigap plan without having to answer health questions.

Get Help Comparing Medicare Advantage vs Medicare Supplements

Sorting through your Medicare options can be difficult and time-consuming. Checking provider networks and drug formularies is even more complicated.

That’s where MedicareFAQ can help; our agents will do the work for you!

We’ve helped thousands of Medicare beneficiaries just like you. We’ll compare both plans side by side, with all the top carriers in your area.

Our agents can see if your doctor is in-network, as well as if your prescriptions are covered.

We’ll help you figure out if an advantage or Medigap plan is better for you.

Plus, when you enroll in a plan through us, you’ll have ongoing support from our Client Care Team at no additional cost. They will help you with yearly premium comparisons. They can even help with claim denials.

You can call one of our experienced licensed agents, or use our rate form to have an agent start comparing rates for you now.