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Medicare Advantage vs. Medigap: What is the Difference?

medicare advantage vs. medigap

When you turn 65, you’ll learn there are many options regarding your Medicare coverage. During your open enrollment period, when you enroll in Original Medicare (Medicare Parts A and B) you can also enroll in a Medicare Supplement plan to complete your coverage. Conversely, instead of enrolling in a Medicare supplement plan, you can enroll in Medicare Part C. Medicare Part C is also known as Medicare Advantage.

You cannot get a Medicare supplement plan when you enroll in Medicare Advantage. To ensure you get the perfect amount of coverage for your situation, it is imperative you know the difference between a Medicare Advantage plan and a Medicare supplement plan.

Medicare Advantage Plans

The federal government requires Medicare Advantage plans to offer the same amount of coverage as Original Medicare. This means that your Medicare Advantage plan will provide coverage for hospital inpatient services and medical outpatient services. A Medicare Advantage plan works by offering Part A and Part B benefits through a private health plan.

You will continue paying your Part B premium with a Medicare Advantage plan. These plans come with copayments and deductibles but have an annual out-of-pocket limit. Once you meet this limit, your plan will pay 100% of your medical expenses. The premium for a Medicare Advantage plan usually ranges from $0 to more than $100 a month. Most Medicare Advantage plans include prescription drug coverage.

While low premiums and prescription drug coverage is attractive, we recommend a second option: a Medicare supplement plan.

Medicare Supplement Plans

If you choose to enroll in a Medicare supplement (Medigap) plan, you will still receive your main coverage under Original Medicare. Medigap plans fill the gaps in Original Medicare. There are ten different Medigap plans available. Each plan provides a variety of coverage, but some plans offer more coverage than others.

These plans cover most, if not all of your out-of-pocket costs associated with Medicare. You can enroll in a Medigap plan in the first six months after you enroll in Part B. Part D prescription drug coverage is not included. As far as the rest of the costs, Medigap plans have an average premium of about $150 to $200 a month. Age, health, and location can affect your premium.

Which One Is Right for Me?

While both Medicare Advantage and Medigap plans have their advantages, we recommend a Medigap plan. The lower cost premiums of a Medicare Advantage plan might look attractive, but it comes with a few sacrifices. With a Medicare Advantage plan, you cannot choose any doctor that you want. If you choose an HMO plan, you can only see plan providers. If you choose a PPO, you can see any provider, but out-of-network providers cost more. This makes for a much lower number of health care professionals you can see, and your preferred doctor might be out-of-network.

However, with a Medigap plan, you can visit any doctor that participates in Medicare. This allows for a wide range of health care providers at your fingertips. Additionally, there are little to no out-of-pocket costs associated with a Medigap plan, whereas you would have to pay deductibles and copays of up to $3,400 to $6,700 a year with a Medicare Advantage plan.

Finally, while Medigap plans do not come with prescription drug coverage, most Part D plans are affordable, with plans as low as $34 in 2018. This plan, in addition to your Medigap plan, would provide you with complete coverage for all your medical needs.

How GoMedigap Can Help

We understand the difficulties of choosing the right plan for you. Our friendly and certified agents can guide you through the differences between Medicare Advantage plans and Medigap plans. We will provide you with quotes unique to your situation, and help you decide what is best for you. To get a free quote, you can fill out this form or call us at (800) 310-2550.

Compare Your Medicare Supplement Rates Immediately!

2 Replies to “Medicare Advantage vs. Medigap: What is the Difference?”

  1. I only have part A Medicare for Myself and My Husband since we are covered through my group health insurance plan with my work. I am planning on retiring next year and need to know the process to get a medigap plan. Do I have to wait until Jan 1 to enroll in Medicare part B since my insurance runs to the end of this year?

    1. Hi Ms. Deighan,

      Consider the size of your company when deciding on when to enroll in Part B. If you work for a company with less than 20 employees, Medicare becomes the primary payer for your coverage. Your coverage through your employer pays secondary in this case.

      If you work for a company with more than 20 employees, your employer plan will offer the same benefits as it did before you were eligible for Medicare. In this case, you can delay your Part B enrollment until you retire.

      You will enter a special enrollment period after you retire in which you are able to enroll in Part B without penalties.

      I hope this helps! If you have any other questions, please feel free to contact us at (800) 310-2550. Have a great day!

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