Medicare Supplement or Medicare Advantage? Choose Wisely.

When you turn 65, there are so many new choices when it comes to health insurance. You might feel overwhelmed and unsure about how to pick a plan. Once you turn 65 you are eligible for government Medicare insurance, Medicare supplement plans, and Medicare advantage plans. After enrolling in the government Medicare program, you must decide if a you need a Medicare Advantage plan, or if you should keep the Original Medicare coverage (Parts A and B) and sign up for a Medicare Supplement plan. Both of these plans offer different benefits, so it is important to evaluate both options carefully to effectively meet your medical and financial needs. The things you must consider are:

  •         Deductibles
  •         Monthly premiums
  •         Restrictions on doctors, hospitals, and pharmacies
  •         Prescription drugs that you require regularly
  •         Cost of health care and hospital services you use often
  •         Maximum out of pocket expense you can afford

Medicare Supplement Plan

Medicare will pay 80% of Part B and the 20% left is up to you to pay out of pocket. Because these out of pocket expenses tend to be overwhelming, many people will enroll in a Medicare Supplement Plan to reduce the costs. These plans do not cover prescription drugs, so you will have to buy a stand-alone Part D plan for drug coverage.

Medicare Supplement plans are private plans that are offered by private companies and cover either most or all of Original Medicare’s out of pocket expenses. When you have a hospital visit, Medicare will pay your claims and automatically forward them to your Medicare Supplement plan, which will pay its portion of the bill.

Medicare Advantage Plan

A Medicare Advantage Plan is also referred to as a Part C plan. With this plan, you continue to pay your Part B premium. These plans come with deductibles and co-pays, and after you pay these, they add up to a certain limit. This limit is an annual out of pocket limit, and the average typically ranges from $3,000 to $4000. Once you have reached the out of pocket limit, the plan will pay 100% of your medical bills for the remainder of the year. This is not offered by Original Medicare.

This plan is a government program that is offered by private insurance companies, and unlike a Medicare Supplement Plan it offers prescription drug coverage.

The Difference

There are some pros and cons of each type of plan, and you have to really think about the things that matter to you most when it comes to Medicare coverage.

  1. Costs

  • Medicare Supplement is more expensive when it comes to a monthly premium payment, but in return you have lower doctor copays and other medical services.
  • Medicare Advantage has a lower monthly premium, and once you pay off your annual out of pocket expenses (deductible and copays), the company will pay the rest of your medical expenses for the remainder of the year. Your out-of- pocket cost will be less than with Medicare Part A and Part B alone.
  1.   Coverage

  • Traveling
    • Medicare Supplement plans allow you to go to any doctor in the USA that accepts Medicare. If you travel a lot or live in a different state part of the year, it is best to go with Medicare Supplement.
    • Medicare Advantage limits you must to doctors in network of your plan and in the coverage area, or you must pay out of pocket for those not in network. You must also choose a primary physician.
  • Health
    • A Medicare Supplement plan is best if you have ongoing medical issues. Not only can you sign up with pre-existing conditions, but if you have an ongoing issue with your health and need to see multiple doctors without network restrictions, then a Medicare Supplement plan covers it.
    • A Medicare Advantage plan is best if you do not see the doctor that much and are okay with a restricted doctor network.

  1. Prescription Drugs

  • Medicare Supplement plans do not provide any prescription drug plan; you would have to purchase a stand-alone Part D plan.  
  • Medicare Advantage plans usually include a prescription drugs plan.
Some differences between Medicare Supplement and Medicare Advantage coverage.
Some differences between Medicare Supplement and Medicare Advantage coverage.

It is important to note that you cannot have both. Medicare Supplement plans do not work with Medicare Advantage plans, they are only meant for Original Medicare. This means that you cannot use your Medicare Supplement plan to take care of the copayments, premiums, or deductible for your Medicare Advantage plan.

When signing up for a Medicare Supplement plan, you have a 30 day trial period where you can decide to keep the plan, change to another plan, or cancel the plan and receive a refund. You can cancel at any time after the 30 day period, but will not receive a refund. You can switch from a Medicare Supplement policy to Medicare Advantage during the annual Medicare Open Enrollment period from October 15 through December 7. During this period you may also switch from Medicare Advantage to original Medicare.

If you want more guidance or information, our agents at EZ.Insure can help walk you through your options. We will help find a plan within your budget, help you figure out how much coverage you need, and sign you up when you are ready. Contact an us at Replies@ez.insure or call 855-220-1144 to connect with one of us. Or to receive an instant quote, enter your zip code in the bar above. It is just that easy. 

About The Author: Cassandra Love

With over a decade of helpful content experience Cassandra has dedicated her career to making sure people have access to relevant, easy to understand, and valuable information. After realizing a huge knowledge gap Cassandra spent years researching and working with health insurance companies to create accessible guides and articles to walk anyone through every aspect of the insurance process.
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