Are you getting ready to enroll in Medicare and considering a Medicare Advantage or a Medicare Supplement Plan? Although they both provide supplemental coverage, their differences may surprise you! With both Medicare Advantage and Medicare Supplement plans, there are several plans and many carriers to choose from. If you’d like to view all the plans available to you, you can use the plan finder on Medicare.gov, but given the myriad of options available, we recommend you work with a licensed broker.
Do I Need a Medicare Supplement or Medicare Advantage Plan?
Chances are you would be best served to purchase a plan to enhance your original medicare coverage. Although Medicare Parts A & B cover roughly 80% of the costs for hospital and doctor visits, you are responsible for the remaining 20%. With surgical procedures ranging in the tens of thousands of dollars, this can leave you with some hefty out of pocket costs!
Also, Medicare Parts A & B also do not cover most prescription drugs. For prescription drug coverage, you need Medicare Part D or, of course, Medicare Advantage. Without prescription coverage, you could end up paying thousands for an expensive medication! In fact, some name brand cholesterol medications can go as high as $1700 without prescription coverage. These are extremes cases. There are many completely affordable prescriptions, some are even free dependent upon where they are filled. Regardless, a Medicare Advantage or Medicare Supplement plan helps to provide peace of mind in case the worst should happen. If you need help, you should contact a licensed broker who will work with you to find the right plan for you! Contrary to popular belief, it’s not always the most expensive plan. You want appropriately priced coverage tailored for your needs.
Medicare Supplement or Medicare Advantage: Which Plan Should I Choose?
Medigap Plans (Supplement Plans) are designed to help cover the gaps in Original Medicare. Conversely, Medicare Advantage plans are actually a complete replacement for your Original Medicare. Although, there are some areas of overlap, there are also many differences.
| Medicare Supplement | Medicare Advantage | |
| Out of Pocket Spending
|
There is a cap on out of pocket spending
|
There is a cap on out of pocket spending
|
| Original Medicare
|
Fills the gaps in coverage
|
Replaces Medicare Parts A & B
|
| RX
|
Does not include Prescription Drug Coverage
|
Most plans include prescription drug coverage
|
| Network of Providers
|
Choice of any doctor or hospital that accepts Medicare (regardless of who your supplement carrier is) and MOST DO
|
Limited to typical HMO or PPO in and out of network charges dependent upon your plan and carrier. You may have to travel a distance to see someone who is in the network.
|
| Costs
|
Monthly costs average $50-$200 dependent upon your plan, carrier & state
|
Monthly costs average $0-100 dependent upon your plan, carrier and state
|
| Referrals
|
Does not require referrals to see a specialist
|
May require referrals to see a specialist
|
| Comparison Shopping
|
Standardized so coverage is the same, regardless of the carrier making it easier to comparison shop
|
Much wider variety of plans and carriers with different benefits such as dental, vision, hearing, and wellness. BUT these benefits may be dropped annually.
|
| Medical Underwriting
|
Medical underwriting may be required, dependent upon your plan and when you enroll.
|
No medical underwriting is required.
|
Which is less expensive: Medicare Supplement or Medicare Advantage?
Medicare Advantage often works out to be cheaper than a supplement plan, PLUS part D when looking at the monthly cost. However, you really need to research in advance to discover copays and any fees associated with the additional benefits. In most cases, the out of pocket maximum is much larger on Medicare Advantage.
You may be tempted to sign up for Medicare Advantage initially and switch to Medigap or supplement plan later when your health needs are greater, but remember, at that point you could be subject to medical underwriting and therefore, denied.
How to Enroll
Medicare Supplement & Advantage Plans have different enrollment periods. It’s very important to be aware of the enrollment periods to keep your options open.
For a Medicare Supplement Plan, your individual open enrollment period is the 6 months after you have turned 65 and have enrolled in Medicare Part B. If you miss this open enrollment period, you may still qualify for a special enrollment period as long as you maintain creditable coverage elsewhere without any gaps. Should you enroll outside of these enrollment periods, you may be subject to medical underwriting and could potentially be denied.
For Medicare Advantage, your initial open enrollment period is the three months prior to, the month of, and the three months after you turn 65. You also have the opportunity to enroll during the annual enrollment period which is between October 15 and December 7th every year.
For more information, please contact us at iHealthBrokers at (888)918-0518 or schedule a call!
Jesse Smedley is the Principal Broker for iHealthBrokers and the founder, president, and CEO of Smedley Insurance Group, Inc. and iHealthBrokers.com. Since the inception of SIG in 2007, Jesse has been dedicated to helping people save money on their health insurance by providing them with resources to educate themselves on all their health insurance options, both under age 65 and Medicare beneficiaries. He is featured in many publications as well as writes regularly for expert columns regarding health insurance and Medicare.
