Medicare Advantage vs Supplement Plans
The terms Medicare Advantage plan and Medicare Supplement plan are often used interchangeably by seniors, but they are drastically different. If you already have a plan, it is important to know which one you have. If you are entering Medicare and do not have one, hopefully you will obtain a better understanding of the difference and can make a more informed decision.
Medicare Advantage Plans:
Medicare beneficiaries can choose to have their Medicare benefits administered through Original Medicare (Parts A&B) or through private insurance companies. These plans offered through a private insurance company are referred to as Medicare Advantage plans (Part C). The Medicare Advantage (MA) plans will often include the Part D prescription drugs as well, though it is not a requirement. Each insurer must have their plans approved by the government each year. This ensures that the benefits the plan provides are equal to or greater than those offered by Original Medicare (OM). Except for a few exceptions, a beneficiary may only switch to/from one Medicare Advantage plan to another or to Original Medicare once per year, during the Annual Election Period or Open Enrollment Period. These plans typically charge a premium which is in addition to the monthly Part B premium which still must be paid. There are a number of different types of programs (PPO, HMO, etc), and many offer simple copays for doctor visits and hospital stays.
Medicare Supplement Plans:
If one decides to stay with Original Medicare, they are left with deductibles and coinsurance that Medicare does not pay. To fill in these gaps and reduce their out of pocket costs, may seniors choose to purchase a Medicare Supplement plan, also known as a Medigap plan. These are standardized plans that are offered through private insurance companies. These plans are lettered from A to N and should not be confused with Medicare Parts A-D. Because they are standardized, the benefits provided under each plan letter are the exact same regardless of who provides teh insurance. This page will compare each Medigap plan and show what is covered under each (this will vary in Massachusetts, Wisconsin, and Minnesota.) With a supplement plan, a separate Part D prescription plan will be necessary as they are not provided together.
This is only small sample of each plan. For more information on each or to see which is right for you, please contact us.