Medicare Supplement Vs Medicare Advantage Plans, What Is Right For You
Medicare Advantage vs Medicare Supplement…which is the better choice?
Many people have heard of these plans, but don’t know what options are suitable for their needs.
The truth is that there are many differences between Medicare Supplement Insurance and Medicare Advantage Plans. Both can be beneficial when you understand what they offer.
Keep in mind that you can only have one or the other.
This article will highlight the main components of both types of plans to help you decide the best course for you when it comes to the medical coverage you need.
The truth is that there are many differences between Medicare Supplement Insurance and Medicare Advantage Plans. Both can be beneficial when you understand what they offer.
Keep in mind that you can only have one or the other.
This article will highlight the main components of both types of plans to help you decide the best course for you when it comes to the medical coverage you need.
Two Types of Plans
Before we dig a little deeper into each of these plans, it’s essential to know their fundamental differences. Medicare Advantage, also known as Medicare Part C, are health plans overseen by CMS and administered by insurance companies. These plans are available to Medicare beneficiaries and are not medically underwritten. Supplement plans are additional insurance policies that cover the gaps in Original Medicare Part A & B. These plans are overseen by the state insurance department and issued by insurance carriers. Unless a Medicare beneficiary is in an enrollment period that waives underwriting, they will need to medically qualify for this type of plan.
Types of Medicare Plans
There are several types of Medicare Plans available:
Health Maintenance Organization Plans (HMO)
Preferred Provider Organization Plans (PPO)
Private Fee-for-Service Plans (PFFS)
Special Needs Plans (SNPs)
HMO Point-of-Service Plans (HMOPOS)
Medical Savings Account Plans (MSA)
Each type has different rules and features regarding networks, referrals, and out-of-pocket costs.
Health Maintenance Organization Plans (HMO)
Preferred Provider Organization Plans (PPO)
Private Fee-for-Service Plans (PFFS)
Special Needs Plans (SNPs)
HMO Point-of-Service Plans (HMOPOS)
Medical Savings Account Plans (MSA)
Each type has different rules and features regarding networks, referrals, and out-of-pocket costs.
Highlights Of Advantage Plans
Medicare Advantage takes the place of your original Medicare, but you are still required to pay your Part B premium each month. One of the primary components of Medicare Advantage is that many have a network of providers. This means that members must use a provider in the network if they want to have the maximum benefits paid. In addition, the plan may also require the member to get a referral from their primary care physician to see another provider such as a specialist. The specialist must also participate in the plan network for maximum benefits to be paid.
You pay healthcare costs through daily co-pays and coinsurance with Medicare Advantage. People who have these plans tend to pay less in monthly premiums, but have more out of pocket exposure. During years when there is not much plan usage, a beneficiary is likely to pay less in total medical expenses. However, those who suffer from chronic health conditions who enroll in this plan can often experience higher out-of-pocket costs due to hospital stays and co-insurance payments.
You pay healthcare costs through daily co-pays and coinsurance with Medicare Advantage. People who have these plans tend to pay less in monthly premiums, but have more out of pocket exposure. During years when there is not much plan usage, a beneficiary is likely to pay less in total medical expenses. However, those who suffer from chronic health conditions who enroll in this plan can often experience higher out-of-pocket costs due to hospital stays and co-insurance payments.
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Additional Benefits of Medicare Advantage Plans
These plans often include additional benefits not covered by Original Medicare, such as dental, vision, hearing aids, and wellness programs.
Some plans may even offer transportation to doctor visits, over-the-counter benefits, and meal benefits. These extra benefits can be particularly attractive to beneficiaries looking for comprehensive coverage beyond just medical and hospital insurance.
However, it’s crucial to understand that medicare plans can change their benefits, provider networks, and drug formularies annually.
This means you’ll need to review your plan each year during the Annual Enrollment Period (October 15 – December 7) to ensure it still meets your needs.
Some plans may even offer transportation to doctor visits, over-the-counter benefits, and meal benefits. These extra benefits can be particularly attractive to beneficiaries looking for comprehensive coverage beyond just medical and hospital insurance.
However, it’s crucial to understand that medicare plans can change their benefits, provider networks, and drug formularies annually.
This means you’ll need to review your plan each year during the Annual Enrollment Period (October 15 – December 7) to ensure it still meets your needs.
Highlights Of Supplement Insurance
Medicare Supplement Insurance is designed to fill in Medicare Part A and B gaps, otherwise referred to as Original Medicare. With Supplement Insurance, you pay the majority of your healthcare costs upfront through monthly premiums. Each plan is priced based upon the benefits it provides and how it is rated. For many retirees it is easier to budget a monthly premium and know what their fixed costs are whether they use the plan or not.
Original Medicare and Medicare Supplement Insurance plans do not have provider networks. This means the they can see any doctor or specialist that accepts Medicare with no referrals required. Congress made one change to Medicare Supplement Insurance worth noting. If you become eligible for Medicare after January 1, 2020 you cannot purchase a plan that provides coverage for the Part B deductible. This means that you cannot purchase a Plan C or Plan F.
Original Medicare and Medicare Supplement Insurance plans do not have provider networks. This means the they can see any doctor or specialist that accepts Medicare with no referrals required. Congress made one change to Medicare Supplement Insurance worth noting. If you become eligible for Medicare after January 1, 2020 you cannot purchase a plan that provides coverage for the Part B deductible. This means that you cannot purchase a Plan C or Plan F.
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Standardization and Coverage of Supplement Plans
Supplement plans are standardized across most states, meaning the benefits for each plan letter (A, B, C, D, F, G, K, L, M, and N) are the same regardless of which insurance company sells the policy. This standardization makes it easier to compare prices between different insurance companies.
Another advantage of Medicare Supplement plans is that they offer nationwide coverage. This can be particularly beneficial for people who travel frequently within the United States or split their time between different states.
Another advantage of Medicare Supplement plans is that they offer nationwide coverage. This can be particularly beneficial for people who travel frequently within the United States or split their time between different states.
Factors to Consider When Choosing Between Medicare Advantage and Medicare Supplement
When deciding between Medicare Advantage and Medicare Supplement, consider the following factors:
Costs: Compare monthly premiums, deductibles, copayments, and out-of-pocket maximums.
Coverage: Assess your healthcare needs and which plan best covers them.
Provider networks: If you have preferred doctors or hospitals, check if they’re in-network for Advantage plans you’re considering.
Prescription drug coverage: Determine if you need this included in your plan.
Additional benefits: Consider if you need or want extras like dental, vision, or hearing
coverage.
Travel: If you travel frequently, a supplement plan might offer more flexibility.
Health status: If you have chronic conditions or expect high healthcare utilization, a supplement plan might provide more comprehensive coverage.
Costs: Compare monthly premiums, deductibles, copayments, and out-of-pocket maximums.
Coverage: Assess your healthcare needs and which plan best covers them.
Provider networks: If you have preferred doctors or hospitals, check if they’re in-network for Advantage plans you’re considering.
Prescription drug coverage: Determine if you need this included in your plan.
Additional benefits: Consider if you need or want extras like dental, vision, or hearing
coverage.
Travel: If you travel frequently, a supplement plan might offer more flexibility.
Health status: If you have chronic conditions or expect high healthcare utilization, a supplement plan might provide more comprehensive coverage.
So Which Plan Is The Best?
The quick answer is simple, whichever plan addresses your specific needs and budget. While many agents will debate Medicare Advantage vs Medicare Supplement benefits, the reality is that each individual’s needs can be quite different and should be taken into account. Get the personalized attention you deserve by talking to one of our advisors today. Call (800)924-4727 or email [email protected] with the subject line “Please have an advisor contact me”
Frequently Asked Questions (FAQs)
When can you change Supplement Plans?
There is no set date during the year when you can change supplement plans. There are a few things to keep in mind when deciding to change your supplement plan before it comes up for renewal.
If you pay your premium annually, you will need to wait until the new policy is issued and then you can apply for a refund of unused premiums from your current company. You should never cancel your existing coverage before your new policy has been approved.
Can you change supplement plans with pre-existing conditions?
This is not a simple yes/no answer. Some supplement insurance companies may look at a pre-existing condition as too severe and will not issue a policy, where another carrier may not view the pre-existing condition as un-insurable. Of course, there are certain conditions that insurance companies are going to shy away from such as currently being treated for cancer, on kidney dialysis, or have an upcoming surgery planned. The best thing you can do is simply talk with an insurance advisor and let them see what all your options are.
What is the best Advantage plan for Medicare?
The best Medicare Advantage plan is the one that covers your individual needs with the least amount of financial exposure. While Medicare Advantage has what are known as Star Ratings, this is only one way to measure which plan you should investigate further. You need to look at the network of providers to see if all your doctors and facilities participate.
In addition, you need to make sure that all your prescriptions are being covered on the plan’s formulary list. Also, don’t get caught up in the low co-pays when seeing your primary care physician. While a $20 co-pay doesn’t seem like much, you need to be aware of the fact that this adds up when seeing your doctor multiple times a year.
Throw in some visits to a specialist who has a $40 co-pay and the amounts start to add up. Speaking of co-pays, don’t forget that most Advantage plans have a daily hospital co-pay that can be upwards of $300 per day up to 5 days in the hospital.
The good news is that Medicare Advantage must offer a cap on what you can be out of pocket for in a calendar year. All the approved expenses that you pay out of pocket go towards this cap. It is important to be aware of what the plan’s maximum out of pocket amounts are each year. Some can be as high as $10,000 for a calendar year.
There is no set date during the year when you can change supplement plans. There are a few things to keep in mind when deciding to change your supplement plan before it comes up for renewal.
If you pay your premium annually, you will need to wait until the new policy is issued and then you can apply for a refund of unused premiums from your current company. You should never cancel your existing coverage before your new policy has been approved.
Can you change supplement plans with pre-existing conditions?
This is not a simple yes/no answer. Some supplement insurance companies may look at a pre-existing condition as too severe and will not issue a policy, where another carrier may not view the pre-existing condition as un-insurable. Of course, there are certain conditions that insurance companies are going to shy away from such as currently being treated for cancer, on kidney dialysis, or have an upcoming surgery planned. The best thing you can do is simply talk with an insurance advisor and let them see what all your options are.
What is the best Advantage plan for Medicare?
The best Medicare Advantage plan is the one that covers your individual needs with the least amount of financial exposure. While Medicare Advantage has what are known as Star Ratings, this is only one way to measure which plan you should investigate further. You need to look at the network of providers to see if all your doctors and facilities participate.
In addition, you need to make sure that all your prescriptions are being covered on the plan’s formulary list. Also, don’t get caught up in the low co-pays when seeing your primary care physician. While a $20 co-pay doesn’t seem like much, you need to be aware of the fact that this adds up when seeing your doctor multiple times a year.
Throw in some visits to a specialist who has a $40 co-pay and the amounts start to add up. Speaking of co-pays, don’t forget that most Advantage plans have a daily hospital co-pay that can be upwards of $300 per day up to 5 days in the hospital.
The good news is that Medicare Advantage must offer a cap on what you can be out of pocket for in a calendar year. All the approved expenses that you pay out of pocket go towards this cap. It is important to be aware of what the plan’s maximum out of pocket amounts are each year. Some can be as high as $10,000 for a calendar year.
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Taking Action
Now that your main questions about Medicare Supplements vs Medicare Advantage have been answered, it’s time to take the next step. Feel free to give us a call toll-free at 1.800.924.4727 or complete the form request on our website.
With all insurance products, the longer you wait, the more complicated the outcome can get, so there is no need to delay in making your decision.
With all insurance products, the longer you wait, the more complicated the outcome can get, so there is no need to delay in making your decision.