Medicare Advantage vs. Medicare Supplement

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    Medicare Advantage Vs. Medicare SupplementWhich should I choose?Before you can make a decision on which Medicare option is best for your needs, you must first understand the basics of Medicare Advantage (MA) and Medicare Supplement (Medigap) plans. They are very different insurance plans with distinct benefits. The answer to the question “Which should I choose?” depends on your circumstances and needs.


    Medicare Supplement Insurance (Medigap)

    A Medigap plan is an insurance policy designed to pay for certain healthcare expenses not covered by Medicare Part A and Part B. In every state but Massachusetts, Minnesota, and Wisconsin, there are ten standardized Medicare Supplement plans (Plans A through N). The ten plans have different combinations of benefits and deductibles. While Medigap plans always have more benefits than Medicare Part A and Part B, they are no longer allowed to offer prescription drug coverage. In order to avoid a reoccurring late enrollment penalty a prescription drug coverage must be added through a stand-alone Medicare Part D plan.


    Medicare Advantage (MA)

    MAs are health plans offered by private insurance companies that provide the standard hospitalization and medical coverage of Medicare Part A and Part B. In some cases, a MA plan may include additional benefits that are not part of original Medicare such as prescription drug coverage. Medicare Advantage plans may deliver their benefits through one or more of the following options. A health maintenance organization (HMO) is a network of health care providers and facilities where you choose a primary care physician to coordinate your care. A preferred provider organization (PPO) is also a network of health care providers and facilities but typically you do not need to select a primary care physician and you have more flexible options regarding out-of-network care. A private fee-for-service (PFFS) is a mode of benefit delivery where you are not limited to a network but there are no guarantees that your doctor or hospital will accept the plan.


    What’s the Difference Between the Two?

    The standardized Medigap plans are uniform in the 47 states that offer them. Consequently, a given plan type (e.g. Plan F) has the same benefits regardless of the insurance company that provides the policy or the state in which you reside. On the other hand, Medicare Advantage must provide all Medicare Part A and B coverage but, depending on the insurer and the specific plan, may cover more than Part A and Part B benefits. Excluding drug coverage, any standard Medigap plan with Original Medicare Parts A & B will have more benefits than a standard Medicare Advantage program since a Medicare Advantage program is only required to duplicate Medicare Part A & B benefits. However, as mentioned earlier, some Medicare Advantage programs offer benefits beyond those found in Part A and Part B.


    Some Medicare Advantage plans offer prescription drug coverage (often for an additional monthly cost). With a Medigap plan, in contrast, you would need to enroll in a separate prescription drug plan. However, remember that the total cost of drug coverage, as well as coverage for the specific drugs you are taking, is of utmost importance when comparing your options. In some cases, you may find that a Medigap with a stand-alone prescription drug plan has lower total costs than a Medicare Advantage plan with drug coverage. In other cases, the reverse might be true.


    Comparison Is Key!

    When choosing between a Medigap plan and a Medicare Advantage plan, it is best to avoid going it alone. Our agents are licensed and certified to assist you with your Medicare needs. We also work with a wide variety of carriers to assure that you’re placed with a plan that’s best suited for your needs.  Remember that while the benefits of Medigap plans are standardized in the states having plans A through N, their prices are not. Plan F from one insurance company may be significantly cheaper than Plan F from a different company in the same state. Some of the things to consider when making your decision include:

    •Monthly premium


    •Doctor and healthcare facility restrictions


    •Anticipated plan costs given your typical use of healthcare and hospitalization services

    •Prescription drug coverage cost sharing as it relates to your medication usage

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