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Is Medicare Advantage or Medigap better for you?

Medicare advantage or Medigap

Choosing health insurance is a critical decision that affects both your current and future health. You have an option when it comes to Medicare coverage, which is fortunate.

Original Medicare covers your primary hospital and outpatient medical requirements, but you may choose to add coverage for drugs, vision, and dental. You’ll also have to pay deductibles, premiums, and other out-of-pocket medical expenses if you have Original Medicare.

Let’s learn about the distinctions between Medicare Advantage and Medigap plans, as well as how they can help you get more coverage.

What’s the difference between Medigap and Medicare Advantage?

The Medicare Advantage (Part C) and Medicare Supplement (Medigap) plans are supplements to your original Medicare coverage (Parts A and B). They may provide you with the customization you require to fulfil your precise healthcare requirements.

Both plans are meant to provide coverage that is not available through other aspects of Medicare. You cannot, however, have both Medicare Advantage and Medigap coverage.

You must choose either Medicare Advantage or Medigap if you want supplemental Medicare coverage.

Medicare Advantage Plans: What You Should Know

Private insurance options for Medicare coverage are known as Medicare Advantage plans. Here’s a rundown of Medicare Advantage’s coverage, fees, and eligibility requirements.

Coverage under Medicare Advantage

These plans include everything that the Original Medicare does, such as:

  • Hospitalization
  • Healthcare services
  • Prescription medications

Depending on your Medicare Advantage plan, you may also be covered for:

Costs of Medicare Advantage

Medicare advantage premiums vary like any other insurance plan, based on the provider and the plan you select.

Some programs have no monthly fees, while others charge hundreds of dollars. However, it’s uncertain whether your Part C premium will be higher than your Part B premium.

Costs such as copays and deductibles will also vary depending on the plan. When it comes to evaluating future expenses for your Medicare Advantage plan, properly comparing programs while shopping is your best chance.

Other factors that may influence Medicare Advantage plan costs include:

  • How often you’d like to use medical services
  • The location of your medical care (in-network or out of network)
  • Your earnings (this may determine your premium, deductible, and copays)
  • If you receive financial help such as Medicaid or if you have a disability

Eligibility for Medicare Advantage

To be eligible for Medicare Advantage, you must:

  • Have original Medicare coverage (Medicare parts A and B).
  • Living in a Medicare Advantage insurance provider’s service region that offers the coverage/price you want and accepts new users during your enrollment period.

What You Should Know About Supplement Plans for Medicare

Medicare supplement (Medigap) plans are optional insurance policies that help pay for your original Medicare coverage’s out-of-pocket payments. Find out more about Medigap coverage, prices, and eligibility in the sections below.

Medigap insurance

Medigap insurance is a Medicare supplement plan that helps pay for out-of-pocket expenses not covered by your original Medicare plan. These expenses could include:

  • Coinsurance and hospital expenses under Medicare Part A
  • Costs associated with Medicare Part A hospice coinsurance or copayments
  • Costs of Medicare Part B coinsurance or copayment
  • Expenses of blood transfusions for the first three pints
  • Coinsurance for skilled nursing facilities
  • Deductible for Medicare Part A
  • Deductible for Medicare Part B
  • Excess costs under Medicare Part B
  • Medical expenses incurred while travelling abroad in the event of an emergency.

Plan A, B, C, D, F, G, K, L, M, and N are the ten Medigap plans currently available.

Part B deductibles are no longer covered by newly purchased Medigap policies effective January 1, 2020. You will not buy Plan C or Plan F if you become eligible for Medicare in 2020 or later.

However, Medigap can be purchased in addition to your initial Medicare coverage (parts A, B, or D).

The cost of Medigap insurance

Again, the cost of any insurance plan is determined by your eligibility and the sort of coverage you desire.

The more coverage you want, the more costly Medicare Supplement plans to get. Furthermore, the older you are when you enroll, the higher your premium will be.

The following factors may have an impact on the cost of your Medigap coverage:

  • The year you were born (the older you are when you apply, the more you may pay)
  • The plan you select
  • Whether you are eligible for a discount (nonsmoker, female, paying electronically, etc.)
  • The amount of your deductible (a higher deductible plan may cost less)
  • The day you buy your plan (rules can change, and an older plan may cost less)

Eligibility for Medigap coverage

Three months before, three months after, and the month of your 65th birthday, you are entitled to sign up for a Medicare plan and add Medigap coverage.

Insurance companies aren’t obligated to sell you a Medigap policy if you’re under 65 years old.

You may have more difficulty finding an insurance company that will offer you a plan once the first enrollment period and open enrollment period have passed. If you want a Medigap policy, you should apply as soon as you join Medicare Part B.

Choosing between Medicare Advantage and Medigap:

If you’re still undecided about whether a Medicare Advantage plan or a Medigap plan is best for you, consider the following points while assessing your options.

Considerations for Medicare Advantage

If you meet the following criteria, Medicare Advantage may be a suitable option for you:

  • Parts A, B, and D are already in your possession.
  • You already have a preferred approved provider who accepts Medicare and Medicare Advantage insurance.
  • You want additional benefits, such as hearing, vision, and dental, to be covered.
  • You’d prefer to handle a single insurance plan for all of your needs.

If you meet the following criteria, Medicare Advantage may not be a good fit for you:

  • You travel or plan to travel a lot while on Medicare. (Except for emergencies, you must live within the service area of your plan.)
  • You want to stick with the same insurance provider year after year. (Each year, the requirements for approved providers change.)
  • You’d like to maintain the same rate. (Rates change on an annual basis.)
  • You’re worried about overpaying for coverage you’ll never use.

Considerations for Medigap Insurance

If you meet the following criteria, Medigap insurance may be a suitable option if you:

  • Prefer to choose the amount of coverage you want for out-of-pocket expenses.
  • Require assistance with out-of-pocket costs.
  • Already have the vision, dental, and hearing coverage you need.
  • Want to be prepared for a trip outside of the United States.

Medigap coverage may not be a good fit for you if:

  • You have a Medicare Advantage plan already. (A company cannot sell you Medigap insurance if you already have Medicare Advantage.)
  • You need coverage for long-term care or hospice care.
  • You don’t use healthcare very often and don’t always reach your annual deductible.

The Takeaway

  1. If you need supplemental Medicare coverage, you can choose from a variety of plans.
  2. Medicare Advantage plan covers your Part A, B, and, in some cases, D coverage, as well as other benefits.
  3. Medigap insurance covers out-of-pocket expenses such as copays and coinsurance.
  4. Because you can’t buy both of these sorts of plans, it’s critical to think about your requirements and select the option that best suits them.