Supplement Vs. Advantage

More Than 1 in 5 Beneficiaries Say Medicare is Confusing...

Plans with Different Coverage

Medicare Advantage is a Medicare Replacement Program offered by private insurance company.

Medicare Supplement, also known as Medigap, helps cover expenses not covered by Original Medicare such as copayments, extra fees and deductibles.

The Basic Parts of Medicare

Part A

Hospital insurance, covers inpatient care, skilled nursing facilities, hospice, and home health care. Most people don’t pay a premium because they paid Medicare taxes while working.

Part B

Covers vital services or supplies that are needed to diagnose or treat your medical conditions. Part B also covers some preventive services and doctor visits. However, a monthly premium is required.

Part C (also known as Medicare Advantage)

Combined coverage offered through private insurance companies to replace Parts A and B of Original Medicare with a few added benefits such as vision, dental, and/or prescription drugs.

Part D

Covers prescription drugs. May be purchased along with Medicare Part A and B as well as covered through a Medicare Advantage plan that provides coverage for prescription drugs.

Medicare Advantage

Coverage replaces Original Medicare and is offered by private insurance companies that are approved by Medicare.

How? Well, every month, Medicare pays the private insurance company a fixed amount, and that company covers your costs, according to guidelines set by Medicare. These companies provide all the benefits of Part A and Part B, with the exception of hospice care (that remains covered by Medicare Part A). These plans sometimes also include additional benefits, such as vision, dental, and/or prescription drug coverage. Note that people with end-stage renal disease (ESRD) generally do not qualify for Medicare Advantage plans. When you join a Medicare Advantage plan, you must continue paying your Part B premium.

1 in 4 Medicare consumers pick Medicare Advantage

Medicare Supplement (also known as Medigap)

Medicare Supplement is additional insurance offered by private companies that you can buy to fill in the “gaps” of Original Medicare.

While Original Medicare covers much of your medical costs, it still requires you to pay many fees such as copays, coinsurance, and deductibles. These fees can add up and many retirees are unable to afford them.

While Medicare Supplement plans help with deductibles and other expenses not paid by Original Medicare, they do not cover services if Original Medicare does not cover them. For example, they do not cover long-term care, dental care, or eye glasses.

Most people who are not comfortable with the Medicare Supplement monthly premium consider Medicare Advantage (MA). Unlike Medicare Supplement, MA replaces your Original Medicare. It doesn’t fill in all the gaps but the premiums are usually less expensive.

How Do I Choose?

What is your budget?

Medicare Supplements pay for all or most of your doctor and hospital bills. Medicare Advantage payments can vary.

What are your coverage needs?

Coverage will vary between the two options making it important to choose the right plan for your needs. Medicare supplements rarely include additional services, such as vision and dental. However there are Medicare Advantage plans that will offer these extra services.

Choice of doctors?

Medicare Supplements allow you the flexibility to see a doctor or specialist without a referral. When enrolled in Medicare Advantage, you would be using a network of doctors while paying a bit more to see a doctor outside of your area.

Both Medicare Supplements and Advantage Plans have a specific time period to apply.

If you miss the deadline, you risk being underinsured or not insured at all.

The best time to sign up for Medicare, Medicare Advantage, Medicare Supplements, and Prescription Drug Plans, are the 7-month period near your birthday. Preferably prior to the month of your birthday so that everything will start on the 1st of the month that you were born. Every year thereafter, Medicare Advantage and the Prescription Drug plans have open enrollment from October 15 - Dec 7th with the effective date starting Jan 1 of the new year. With Medicare Supplements, you can sign up and end your plan at any time as long as you qualify medically.

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Sources: Medicare.com, medicare.gov, kff.org