Medigap vs. Medicare Advantage is the choice most people have when turning 65 or going on Medicare. This is intended to be a summary of the plan differences. Different plans are “right” in different situations, but first and foremost, you should understand what each plan covers, how it works and if/how it limits your options in the future.
Medicare Supplement (also known as Medigap)
These plans pay AFTER Medicare.
- Have little to no (Plan F) out of pocket costs at the doctor/hospital
- Can go to any doctor/hospital that takes Medicare, nationwide. There are no networks so no matter where you are in the country you are covered the exact same way.
- What is covered is very straightforward and there are never issues with claims like there are on some other plans. If Medicare covers it, the plan covers it. There are no exclusions.
- There is no involvement in the claims process on the part of the insured. Everything is automatic through Medicare’s “crossover” system.
- Premiums are typically higher than some Advantage plans.
- Does not cover prescription drugs.
These plans pay INSTEAD of Medicare. They replace Medicare.
- Lower premiums for most plans
- Some plans have some coverage for prescription drugs
- May have minimal coverage of some things that Medicare doesn’t cover (i.e. routine dental, hearing)
- There are network restrictions on all plans. Networks are regional.
- Most plans have a “managed care” aspect (i.e. referrals required).
- There is an uncertain future of the program since ‘health care reform’. Many plans have discontinued service for 2014 and more are expected to do the same.
- If you take a Medicare Advantage at the beginning, you have to qualify medically to go to a Medicare Supplement at a later time (unless your Advantage plan is ending). This causes many people to unwillingly/unknowingly get “stuck” in the Advantage programs.
*Information contained herein is the property of Secure Medicare Solutions, Inc. and cannot be copied. It should not be construed to be a referendum on a certain type of plan but rather the opinion, through client experience and plan knowledge, of Secure Medicare Solutions, who works with both types of plans (Medicare Advantage and Medicare Supplement).