What is the difference between Medicare Advantage and Medicare Supplement insurance plans?

What is the difference between Medicare Advantage and Medicare Supplement insurance plans?

Medicare Advantage and Medicare Supplemental Insurance are both ways to get more coverage than what is provided by Original Medicare, and both are provided by private insurance companies.  You cannot generally enroll in Medicare Advantage and Medicare Supplemental Insurance at the same time. 

No matter which you choose, you must still continue to pay for your Medicare Part B. 

Medicare Advantage

Medicare Advantage is an alternative to keeping your Original Medicare. This plan would replace your Original Medicare, and it is still provided through a private Medicare-approved insurance company. Your Medicare Advantage plan must still include your Medicare Part A (except hospice care) and Part B, but it may also offer additional benefits. These benefits may include routine dental, vision, and hearing services. You may also opt for prescription drug coverage. 

Types of Medicare Advantage Plans 

Health Maintenance Organizations (HMOs): These plans require you to use in-network doctors and hospitals. You will need a referral to see a specialist, and you will need to choose a primary care physician. 

Preferred Provider Organizations (PPOs): These plans like you to use a list of "preferred" doctors and hospitals, but you may also use out-of-preferred-network providers. This plan does not require that you have a primary care physician or a referral to see a specialist. 

Private Fee-for-Service (PFFS): These plans decide how must a member will pay out-of-pocket and how much they will pay healthcare providers. 

Medical Savings Account (MSA): This type of plan deposits money into a "health-care checking account" that you can use to pay for services until your deductible is met. 

Special Needs Plans (SNP): These plans help members with particular health conditions receive the care they need.

To enroll in a Medicare Advantage plan, you must be an Original Medicare member, reside in the plan's service area, and (in most cases) not have end-stage renal disease (ESRD).

Medicare Supplement Insurance Plans

If you want to keep your Original Medicare but need more services, you have the option to simply add them onto your original plan with Medicare Supplement insurance, also known as Medigap or Medisup.

While no Medigap plan includes prescription drug coverage, it can cover costs like Medicare coinsurance, copayments, deductibles, and emergency medical services while traveling abroad. 

Each Medigap plan covers a different aspect of Medicare that would otherwise be paid out-of-pocket and ever Medigap plan covers up to one year of Medicare Part A coinsurance. Additionally, each plan will help with hospital costs after Medicare benefits have been used up. It is important to take your time and choose the plan that is right for you. 

Each plan has its own letter (such as Plan A), and 47 states offer ten standardized plans of each type. The only plans without these standardized Medigap plans are Massachusetts, Minnesota, and Wisconsin. These states offer their own standardized Medigap plans that may vary from other states. 

Medigap plans are standardized from one insurance company to another. However, the costs of these plans are not. This means they could fluctuate greatly between different companies, even though the coverage is exactly the same. That is why it is very important to shop around and find the best insurance company for your need. 

If you think a Medigap plan is for you, the best time to enroll is during the Medigap Open Enrollment Period. This is a six-month window that usually starts when you turn 65 and begin Medicare Part B. During this time, you cannot be denied the plan you want or be charged more because of a pre-existing health condition. However, if you choose to enroll in a plan after the enrollment period is over, you are not guaranteed acceptance to a plan, and you may be charged more if you have certain health conditions. 

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What is the difference between Medicare Advantage and Medicare Supplement insurance plans?