Medicare Supplement (Medigap) VS Medicare Advantage

One plan is not necessarily better than the other, they’re just different. They both have PROS and CONS. Simply put, Medicare Supplement is similar to car insurance in that you pay a monthly premium and the policy pays if you need the coverage, whereas Medicare Advantage plans usually have a lower monthly premium, including “zero premium”, and are more of a “pays-as-you-go” plan with a maximum out-of-pocket limit each year.

Medicare Supplement

Medicare Advantage

Part B monthly deductible of $170.10 (in 2022)Has Part B monthly deductible of $170.10 (in 2022)
Part B annual deductible of $233 (Unless enrolled in Plan C or Plan F prior to January 2020)Medicare Advantage plans usually do not have a Part B annual deductible
Original Medicare Part A & B is still your primary insurance from the governmentgggggggggYou no longer have Original Medicare – that has been replaced by an all-in-one HMO/PPO type plan from a private insurance company
Plan coverage never changesPlans can change every year on January 1st
No networks – 90%+ providers accept MedicareUsually restricted to seeing providers in HMO and PPO networks.
Most plans cover all copays and coinsurance ($0 out-of-pocket after annual deductible)Copayments and coinsurance usually required for doctor and hospital visits
No routine dental, vision or hearing coverageMany plans often include routine dental, vision and hearing coverage
Plans are “standardized” throughout all companiesPlans vary between insurance companies (plans are not standardized)
ONE Open Enrollment (no health ?’s) per lifetime unless special circumstance (SEP)Health qualifying is generally not an issue for Medicare Advantage Plans
Can change to a different Supplement anytime (however, must health qualify each time)Usually two enrollment periods per year to change to a different plan. (AEP, OEP)
Plans do not include prescription drug coverageMany plans include prescription drug coverage
Has a monthly premium (typically $100 – $200+ depending on age, state, tobacco use)Monthly premium usually less than a Medigap policy premium. Many plans have zero premium.
Have to “Health Qualify” to get back into a Supplement after Initial Enrollment (IEP)Usually no problem health qualifying and being accepted into a Medicare Advantage plan
Don’t need referral to see specialistSometimes referrals and pre-authorizations are required
Plans are completely mobile if you move Plans are not mobile – often must change plans when moving outside of your plan area.
Usually no extra perks – only supplemental coverage for Medicare Parts A & BMany plans include extra perks – i.e. gym membership, transportation, OTC allowance and more
Outside of Medigap Open Enrollment (or SEP), will need to medically “health qualify” for a Medigap planUsually can not be denied coverage as long as you are eligible for Medicare Part A and Part B
Max-out-of-pocket each year. Other than monthly premium and annual $203 deductible, not many additional out-of-pocket expenses for most Medigap plans. Medicare Advantage plans each have a specific max-out-of-pocket limit. The limit max for 2021 is $7,550 for in-network providers. Higher limit max for out-of-network providers.

**NOTE: You may disenroll from a Medicare Advantage plan any time within the first 12 months of being enrolled and you will be entitled to a Special Enrollment Period (SEP), where you can switch to Original Medicare with a Medicare Supplement (Medigap) with NO medical underwriting (this is known as “trial right”).

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