What’s The Difference Between Medicare Supplement And Medicare Advantage?

April 30th, 2022 - Naples, FL

When you have Medicare, only having Original Medicare (Part A and Part B) is usually not enough coverage and you can be left with expensive medical expenses.

That’s when Medicare Supplement and Medicare Advantage come in. Those 2 options are plans you can enroll in in addition to Original Medicare. Medicare Supplement and Medicare Advantage provide additional coverage to just Part A and Part B, helping you reduce your out of pocket medical cost.

Now, what are Medicare Supplement and Medicare Advantage and what’s the difference between the two?

1- Medicare Supplement (also called Medigap)

Medicare Supplement plans, also called Medigap, cover the “gaps” in Medicare Part A and B, like deductibles, co-insurances, copays, etc.

Those plans are sold by private insurance companies and have standardized benefits, meaning every insurance carrier offers the same benefits. The only difference is the monthly premium, that is based on your age and zip code. Please note that the Medicare Supplement premium must be paid in addition to the Part B premium. 

Some insurance companies add extra benefits in their Medicare Supplement plans such as dental, vision and hearing discounts. 

Medicare Supplement plans don’t have any prescription drug or dental, vision or hearing benefits.

There are 10 types of Medicare Supplement plans for people eligible for Medicare before January 2020 and 8 types of Medicare Supplement plans available for people eligible for Medicare after January 2020. (see chart below for reference).

You can enroll and dis-enroll from a Medicare Supplement plan at any time though out the year, but if you decide to enroll or switch plan outside of your Initial Enrollment Period (IEP), you will have to go though medical underwriting and answer health questions at the time of the application, meaning insurance companies can potentially deny your application (unless you qualify for guaranteed issue).

2- Medicare Advantage (also called Medicare Part C)

Medicare Advantage plans, also called Medicare Part C, are plans sold by private insurance companies. There are “all-in-one” plans that include Part A, Part B and Part D (prescription drug benefit). They usually also include extra benefits like  dental, vision, hearing, chiropractor visits, acupuncture visits, Over-The-Counter (OTC) cards, a gym membership, etc. Please note that benefits varie by carrier and state. 

Most Medicare Advantage plans have a maximum out of pocket limit and depending on the state, some have a $0 monthly premium.

Most Medicare Advantage plans have a network of doctors they member must use, with some types of network giving you the option to go out of network if you choose to do so. Types of Medicare Advantage plans are: PPO (Preferred Provider Organization), HMO (Health Maintenance Organization), PFFS (Private Fee For Service), SNP (Special Needs Plans), etc. 

You can enroll in a Medicare Advantage plan during your Initial Enrollment Period (IEP) and you can make changes or dis-enroll from the plan during the Annual Enrollment Period (AEP) which takes place every year from October 15th through December 7th. There is no medical underwriting with Medicare Advantage plans.

In a nutshell, here are some key differences between Medicare Supplement and Medicare Advantage:

This is just an overview of the difference between Medicare Supplement and Medicare Advantage. If you are interested in learning more, give us a call and our team can help you decide which option is best for you.