Medicare Advantage vs Medicare Supplement

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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 completely different.

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’re no longer enrolled in Original Medicare. Your benefits no longer come from Medicare. You must use the advantage plans provider network, with the exception of emergency situations. Many times you’ll hear people refer to them as Medicare replacement plans.

Let’s review both of these plans in detail.

Key Features of Medicare Supplement Plans

Medicare advantage vs medicare supplement

Medicare Supplements allow you to see any doctor that participates in Medicare in the nation

With Medicare Supplements, there are no provider networks. You can see any health care provider that accepts Medicare assignment. You will not need a referral to see a specialist or get a second opinion. You’ll have the freedom to choose your own doctors.

Depending on what plan you choose to enroll in, you may have minimal out of pocket costs. This includes not having to pay for copays when you visit the doctor.

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. You’ll also have nationwide coverage as well as emergency coverage while traveling.

Coverage for Pharmacy Medications is Additional

When it comes to medications, your Medicare Supplement policy will cover any medications administered at the doctors’ office. To get the prescription medications that you pick up from the pharmacy covered, you’ll need to enroll in a standalone Part D plan. These plans can cost less than $20 per month.

Enroll at Anytime

You can enroll in a Medigap plan at any time. As long as you enroll 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 premiums for someone turning 65 can be anywhere between $90-$160.ƒ

Key Features of Medicare Advantage Plans

medicare advantage vs medigap

With advantage plans, you have to stay within the plan’s network of doctors. Some plan networks are extremely small

Medicare Advantage plans are private insurance plans.

Generally, the premiums are lowered when compared to Medigap policies. You may even be able to find a zero dollar premium plan.

The main reason 1/3 of beneficiaries choose to go with this type of plan is due to the lower premium.

However, there’s a reason the premium is lower.

Network of Providers

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 this step is skipped, most new enrollees find that their doctor does not accept these plans. HMOs are known for having an extremely small network of doctors.

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

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 plan 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 plan, you could be stuck with it until the end of the year.

So, if the plan you chose doesn’t include your medications and/or 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 special 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 serious illness or accident, you can reach 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 offered, 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 switch 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 being effective, you can re-enroll into your Medigap plan without having to answer health questions.

Medicare for Disabled

If you’re eligible for Medicare due to a disability and choose to enroll in an advantage plan prior to turning 65, you’ll be able to switch to a Medigap plan when you do turn 65 without health questions. You get two open enrollment windows. One window is when your Part B is first in effect and the other is when you turn 65.

Get Help Comparing Medicare Advantage vs Medicare Supplements

You're Not Alone, Get Help Choosing a Plan Today

You’re Not Alone, Get Help Choosing a Plan Today

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 the plan’s 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 here to have an agent start comparing rates for you now.