There are many different options for Medicare, and it can be difficult to decide which plan is right for you. In this blog post, we will compare Medicare Advantage VS Medicare Supplement plans. We will discuss the pros and cons of each plan so that you can make an informed decision about which plan is best for you.
Quick Note
Both Medicare Advantage and Medicare Supplement allow you to fill the gaps in coverage that are found in Original Medicare. However, Advantage and Supplement plans vary depending on costs, coverage, and the provider network (HMO, PPO, or PFFS). Therefore, you’ll need to compare these policies to choose the ideal combination of Medicare coverages for your situation.
In general, a Medicare Advantage plan is cheaper and includes more add-ons, such as dental and prescription coverage. However, you’ll pay for a portion of your medical care, so those who need more health services will have larger bills. On the other hand, a Medigap plan is more expensive than Medicare Advantage, but it may provide better coverage for your medical costs. This makes Medigap a good deal for those with chronic illnesses or those who need expensive medical procedures.
What Is The Difference Between Them?
Within Medicare Advantage and Medigap, there are differences in coverage, cost, and provider networks. These vary greatly and thus are important to recognize before you decide on a plan that is right for your health situation.
Initially, both policies require and include Medicare Parts A and B. These plans represent Original Medicare and are your base Medicare health insurance. Beyond Parts A and B, you can customize your coverage through Medicare Supplement or purchase a simple, comprehensive policy through Medicare Advantage.
Medicare Advantage provides coverage for most medical services, such as health, dental, vision, and hearing care. On the other hand, Medicare Supplement is a pick-and-choose type of plan in which you can purchase policies that provide certain types of coverage. For example, if you want coverage for the Part B deductible, the best Medicare supplement policy would be Plan C. However, if you want to cover Part B excess charges, then Plan G would be the best purchase.
The Two Expenses to Consider Are
- The cost of a plan
- The potential cost of health care
Medicare Supplement typically has a higher monthly premium compared to Medicare Advantage. Specifically, Medicare Advantage plans could cost between $0 and $100 a month, while Supplement coverage may vary between $50 and $1,000 per month.
Although Medicare Supplement costs more in premiums, you’ll find there are usually few or no out-of-pocket costs. This is significant, as deductibles and out-of-pocket costs could be as high as $7,550 for Medicare Advantage.
The rule of thumb is that a Medicare Advantage plan is a better deal if you need basic medical care. Your total medical costs are based on your usage, and if you only need moderate amounts of health care, your annual spending could be low.
On the other hand, Medicare Supplement plans, such as the popular Plan F or Plan G, are a better deal if you need expensive medical care. These Medigap plans have a better limit on medical expenses, and your costs are more predictable and consistent.
Provider Networks
A difference to consider between Medicare Advantage and Supplement care is the choice of providers or physicians available. Medicare Supplement policies, in conjunction with Original Medicare, typically do not have differences in provider networks. This means you could visit any doctor that currently participates in Medicare. Furthermore, if you are trying to visit a specialist, such as a cardiologist, you would not need a referral.
On the other hand, Medicare Advantage may have different provider networks depending on the plan you choose, and these restrictions can be a key disadvantage of Medicare Advantage plans. The provider networks are similar to individual health insurance, which defines in-network and out-of-network coverage. These include:
- Health maintenance organization (HMO): You pay less for doctors and Medicare facilities that are in network, but if you go out of network, you may pay the full cost. You usually need to choose a primary care provider (PCP).
- Preferred provider organization (PPO): There’s a network of doctors who are preferred and classified as in-network, but you’ll pay more for out-of-network services.
- Private fee-for-service (PFFS): A doctor must accept the plan’s payment terms and conditions before services are provided. Emergency services are always covered.
Because there are significant differences between provider networks and the coverage you would receive, it’s a good idea to compare networks so you can choose one that offers the best benefits for your health situation.
What is Medicare Advantage?
Medicare Advantage, or Medicare Part C, is an alternative to Original Medicare Parts A and B. This plan is a bundled policy that includes the benefits you would get with Part A (hospitalization), Part B (medical care), and sometimes Part D (prescription drugs). Furthermore, an Advantage plan provides some added benefits that Original Medicare does not cover, such as vision, hearing, and dental care.
You are only eligible to purchase Medicare Advantage if you have already enrolled in Medicare Parts A and B. Once you have enrolled in a plan, you can then begin to look at the different Medicare Advantage policies offered by private health insurance companies.
What is Medicare Supplement?
Medicare Supplement, sometimes called Medigap, is a health insurance plan that complements Original Medicare. In other words, Medicare Supplement helps fill the gaps for Medicare Parts A and B by providing financial help for deductibles, out-of-pocket costs, and coinsurance.
Medigap plans are organized by different letters: Plans A, B, C, D, F, G, K, L, M, and N. Each plan provides different benefits and pays for different parts of Original Medicare. However, all of the policies vary in monthly premiums, and thus the best Medicare supplement plan for you should offer the right balance of cost and coverage.
Medigap policies are offered through private health insurance companies, such as Kaiser Permanente or UnitedHealthcare. However, there’s no difference in coverage between the plans offered by the companies. For example, Plan K from Kaiser Permanente is the same Plan K offered by UHC.
No Matter what you decide on. We are here to help with your insurance needs.