Medicare Supplement vs. Medicare Advantage: Key Differences Explained

Understanding Medicare Supplement and Original Medicare

Medicare is a federal health insurance program designed for people who are 65 or older, as well as certain younger people with disabilities. Original Medicare consists of Part A and Part B. If you are eligible for Medicare, you might be wondering what the difference is between Medicare Advantage and Plan G (a popular Medicare Supplement plan).

Choose Between Medicare Advantage and Original Medicare

When you enroll in Medicare, you can choose to stick with Original Medicare (Part A and Part B) or you can enroll in a Medicare Advantage Plan. Original Medicare covers hospital insurance (Part A) and medical insurance (Part B). Many people enrolled in Original Medicare also buy a Medigap Plan to help cover out-of-pocket expenses that Original Medicare doesn’t cover.

Medigap Plan vs Medicare Advantage Plan

Medigap, also known as Medicare Supplement Insurance, helps cover some of the healthcare costs that Original Medicare doesn’t, such as copayments, coinsurance, and deductibles. Plan G is one of the most comprehensive Medigap Plans available. It covers everything except the Medicare Part B deductible.

On the other hand, Medicare Advantage Plans (also known as Part C) are an alternative to Original Medicare. These plans are offered by private insurance companies and include all the benefits of Part A and Part B, and often include additional benefits like prescription drug coverage (Part D), vision, dental, and wellness programs.

Medicare Advantage and Medigap: Which is Right for You?

Both Medicare Advantage and Medigap Plans offer unique benefits. Here are some key differences to consider:

Coverage: Original Medicare plus a Medigap Plan provides coverage nationwide. Medicare Advantage Plans may have networks that limit you to specific doctors and hospitals.
Costs: With Medigap, you pay a higher monthly premium but may have lower out-of-pocket costs. Medicare Advantage Plans often have lower premiums but higher out-of-pocket costs when you need care.
Additional Benefits: Many Medicare Advantage Plans offer additional benefits like dental, vision, and hearing coverage, which Medigap Plans do not.

Types of Medicare Plans: Which to Choose?

There are different types of Medicare Plans available, and it is important to understand them to make the best choice:

Original Medicare: Includes Part A and Part B. You can see any doctor or hospital that accepts Medicare.
Medicare Advantage Plans: These plans are offered by private companies and include Part A and Part B benefits, and often Part D benefits as well. They may have network restrictions.
Medicare Supplement Plans: Also known as Medigap, these plans help cover out-of-pocket costs not covered by Original Medicare.

Medicare Part A and Part B: What They Cover

Original Medicare includes Part A and Part B. Here’s what they cover:

Part A: Hospital insurance that covers inpatient hospital stays, care in a skilled nursing facility, hospice care, and some home health care.
Part B: Medical insurance that covers certain doctors’ services, outpatient care, medical supplies, and preventive services.

Medicare Advantage Plan: An Overview

Medicare Advantage Plans are an alternative to Original Medicare. These plans are offered by private insurance companies and include Part A, Part B, and often Part D benefits. Many Medicare Advantage Plans also offer additional benefits like dental, vision, and wellness programs. It’s important to review the plan details and network restrictions before enrolling in a Medicare Advantage Plan.

Medicare Supplement Plan G: What You Need to Know

Plan G is a popular Medigap Plan because it offers comprehensive coverage. It covers everything that Plan F covers, except for the Medicare Part B deductible. If you choose Plan G, you will pay the monthly premium for the plan and any out-of-pocket costs for the Part B deductible. After that, Plan G covers the rest of the costs that Original Medicare doesn’t cover.

Medicare Advantage vs Medigap: Making the Choice

Choosing between Medicare Advantage and Medigap depends on your healthcare needs and financial situation. Here are some factors to consider:

Healthcare Needs: If you require frequent healthcare services, Medigap may save you more in out-of-pocket costs.
Budget: Medigap Plans generally have higher premiums but lower out-of-pocket costs. Medicare Advantage Plans may have lower premiums but higher out-of-pocket costs when you need care.
Flexibility: Medigap offers nationwide coverage, while Medicare Advantage Plans may have network restrictions.

What is the Difference Between Medicare Advantage and Plan G?