Author: Strom Johnson
What Are The Differences Between Medicare Advantage And Medigap Insurance Plans
The differences between Medicare Advantage and Supplement Insurance plans are significant. They are different products and are mutually exclusive. You can’t sign up for both. Both exist to help plan members with medical bills not covered by Medicare. Supplemental coverage helps with these bills. Advantage coverage is private insurance that replaces Medicare and Supplemental coverage.
Medicare, funded and managed by the federal government, is offered to anyone over 65, and to individuals with specified disabilities. Part A is coverage for hospital care. Part B assists with visits to doctors offices. Part C allows for Advantage (privatized) coverage, and Part D covers prescription drugs. Part D is government regulated but the coverage must be purchased separately. It’s not an automatic benefit.
Supplemental insurance (Medigap) is billed after the government has paid it’s covered portion of the bill. Government regulations set the standard options for supplemental policies. Plans are the same no matter where you buy them or who you buy from. Individuals decide which options to purchase. Premiums are pricey and no additional benefits are allowed within this type of coverage. Prescription drug coverage still has to be purchased separately.
Part C, Medical Advantage coverage means moving to private insurance. The idea is that private providers will be more efficient and can offer added benefits. They contract with and receive a contribution from the Centers for Medicare and Medicaid (CMS) every month, and then charge a premium based on the extra benefits they provide
Advantage policies offer coverage above and beyond government funded benefits. These add on can include Part D drug coverage, dental, vision, hearing, and preventive health care like physicals and gym memberships. Beneficiaries generally have a deductible and co-pay requirements, but policy premiums are much lower than policy premiums for supplemental coverage.
Part C policies have few exclusions. They’re easy to qualify for. There is a specified enrollment period of 3 months before and after turning 65, or individuals can switch to Advantage coverage between 11/15 and 12/31 of every year. Most are HMO plans, but PPO’s can be purchased also. Many private companies offer Part C coverage. They’re private policies so premiums and benefit options can vary a lot. Do your research to find the best policy for your needs.
Supplemental plans accept new enrollment all year round but medical underwriting standards are higher. They must accept an applicant when they first become eligible for Medicare. Also applicants who chose Advantage coverage but changed their minds in less than 6 months must be accepted for Supplemental coverage. Another exception is plan members who chose Supplemental coverage. They can switch to Part C coverage. If they change their mind within 6 months they can return to Supplemental coverage without meeting new underwriting standards. Beneficiaries choosing Part C coverage can always cancel their policy and return to traditional Medicare during the annual enrollment period.
The federal government provides a benefit guide detailing the benefits and the differences between Medicare Advantage and Supplement Insurance Plans. They also have a website for additional information and contacts. Online insurance sites allow beneficiaries to browse the many plan offerings. Insurance coverage can be confusing. An experienced agent can be a knowledgeable and helpful resource also.
It is very important to fully understand the benefits and costs of the Medicare Advantage or Medicare Supplement Plans that you choose. It is recommended that you call or contact a licensed Insurance Agent or Broker to help guide you navigate the complex world of Medicare.. Free reprint available from: Medigap And Medicare Advantage Insurance Plans- Which Is The Best Fit.
