Supplement vs. Advantage

There are two ways to receive additional Medicare health insurance coverage: Medicare Advantage and Medigap/Medicare supplements.

Medicare Advantage is an alternative to Medicare and also known as Medicare Part C. It's an all-inclusive "bundled" program offered by private insurance companies. It includes hospitalization, doctor's visits, and usually prescription drug coverage. It's an alternative to Original Medicare.

Medigap refers to Medicare supplement plans. Like Medicare Advantage, private insurance companies issue Medicare supplements. They add benefits and close coverage gaps that exist in Original Medicare. By Original Medicare, we refer to the Medicare Part A (hospitalization) and Part B (medical insurance) from the federal government.

You can have either Original Medicare + Medigap/supplement OR Medicare Advantage, but not both. Medigap policies do not work with Medicare Advantage because they overlap coverage. In fact, it's against the law to have a Medigap plan if you have Medicare Advantage.

Medigap policies do not overlap with Original Medicare. They supplement it.

You can enroll in only one Medigap policy each year. If you do not like your plan, you can change it during the Annual Enrollment Period at the end of the year.

Also, you are not allowed to pay your Medicare Advantage plan copayments, deductibles, and premiums with a Medigap policy.

First Time Enrollment to Medicare

If you recently turned 65 or are about to, you can join either Medicare Advantage or a Medigap plan during your Initial Enrollment Period. This period occurs in the 3 months before and 3 months after you turn 65.

You have some rights if this is your first time joining a Medicare Advantage plan and are not happy with it. Under federal law, you can return to Original Medicare within 12 months of joining.

If you previously had a Medigap plan before joining, you might be able to get it back if it's still available. If not, you would buy a different Medigap policy.

Alternatively, if you enrolled in Medicare Advantage when first signed up for Medicare, you can choose from any Medicare supplement policy.

Switch from Original Medicare/Medigap to Medicare Advantage

It's easy to switch from a Medigap plan to a Medicare Advantage plan.

From October 15 through December 7 each year is the Annual Enrollment Period. This is when you can make changes to your Medicare coverage.

Switch from Medicare Advantage to Medigap

If you want to return to Original Medicare, you can switch from Medicare Advantage during the Medicare Advantage Open Enrollment Period from January 1 to March 30. The old program automatically ends when your new policy starts.

Keep in mind that if you leave a Medicare Advantage plan, you might not be able to get it back if you change your mind.

Also, if you have an Advantage plan, it is against the law to buy a Medigap policy unless you're switching back to Original Medicare.

Cost of Medicare Advantage vs Medigap

With Medicare Advantage, you would still pay for Medicare Part A and B as you did previously. You will also pay the Medicare Advantage premium if there is one.

Medicare Advantage premiums can range from $0 to a few hundred per month. The cost of the plan depends on which one you choose and how comprehensive the benefits are. They also have out-of-pocket costs like copays, deductibles, and coinsurance.

Some plans also include dental, vision, and hearing benefits.

With Original Medicare, most people pay $0 for Part A, and $144.60 for Part B. Part D drug plans also have a monthly cost. Plus, you pay a monthly premium for the Medigap plan.

Typically, the federal government automatically deducts your Part B premium from Social Security checks. You pay for Part D and Medigap directly to insurers.

As for out-of-pocket costs, you also pay copays, deductibles, and coinsurance with Original Medicare. Fortunately, Medigap policies usually limit the amount of out-of-pocket expenses.

Medicare Advantage May Offer Extras

Medicare Advantage can offer some extra benefits like dental, vision, and hearing benefits.

Original Medicare and Medigap plans are not allowed to include these preventative benefits. They only cover emergencies like an ear injury or eye disease.

Also, Medicare Advantage sometimes includes fitness, wellness, and nutrition benefits. For example, some plans offer the SilverSneakers program, which allows members to use gyms and fitness facilities around the country.

Which Type of Plan is Best for Me?

Medicare Advantage

  • May offer extra benefits like vision, hearing, dental, fitness, and wellness benefits.
  • Annual out-of-pocket limit for covered Medicare Part A and B services.
  • Most plans include prescription drug coverage.
  • Typically require to see doctors in your network; must get referrals for specialists.
  • Usually costs less than Medicare supplement; some programs are $0 per month; has copays.
  • May lose coverage if you move.
  • Lower cost every month, but can be more costly for frequent doctor's visits, treatments, and hospitalization.
  • Limited network of doctors and treatment centers. Not suitable for people who travel domestically or internationally.

Medicare supplement

  • Does not offer extra benefits like dental, vision, or hearing.
  • Annual out-of-pocket limit for covered Medicare Part A and B services.
  • Typically, premiums cost more, but lower annual out-of-pocket costs; some plans do not require copays.
  • Does not include prescription drug coverage; you must enroll separately in a Medicare Part D plan.
  • Can see any doctor in the US who accepts Medicare; no network, no need for referrals.
  • Higher monthly price, but lower out-of-pocket costs for doctor's visits, treatments, and hospitalization. May not even require copays.
  • Nation-wide coverage, good for traveling within the US. Not suitable for traveling internationally.

Where Can I Buy a Medicare Supplement or Medicare Advantage Plan?

AARDY is the nation's fastest Medicare insurance marketplace. You can compare Medicare supplements and Medicare Advantage plans to find the one that best fits your needs.

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