This
article was updated on: 06/30/2017
After
enrolling in the Medicare program, beneficiaries must decide how they want to
receive their Original Medicare, Part A and Part B, benefits and whether they
need additional coverage. This means that they will have to decide if a
Medicare Advantage plan is right for them, or if they should stick with
Original Medicare coverage and sign up for a Medicare Supplement plan for added
benefits. Each of these Medicare plan options come with different
benefits, costs, and rules; hence, it is important to weigh both options
carefully before choosing.
What is Medicare Advantage?
Also
called Medicare Part C, Medicare Advantage plans provide coverage through
private insurance companies approved by Medicare. These companies provide all
the benefits of Part A and Part B, with the exception of hospice care (that
remains covered by Medicare Part A). These plans sometimes also include
additional benefits, such as vision, dental, and/or prescription drug coverage.
Note that people with end-stage renal disease (ESRD) generally do not qualify
for Medicare Advantage plans. When you join a Medicare Advantage plan, you must
continue paying your Part B premium.
What is Medicare Supplement?
Also
known as Medigap, Medicare Supplement plans are offered by private insurance
companies and can take care of certain health care costs not covered by
Original Medicare, like deductibles, premiums, and copayments. There are 10
standardized plans in 47 states, while Massachusetts, Minnesota, and Wisconsin
each have their own plan offerings. Plans are categorized by letter—A, B, C, D,
F, G, K, L, M, and N—and plans of the same letter offer the same benefits.
However, insurance companies can offer plans at different prices; therefore,
you may have different out-of-pocket costs, even if the standardized plan
benefits are the same. These plans do not provide prescription drug coverage.
This means that you will have to enroll in a stand-alone Medicare Prescription
Drug Plan for medication coverage.
While
Medicare Supplement plans help with deductibles and other expenses not paid by
Original Medicare, they do not cover services if Original Medicare does
not cover them. For example, they do not cover long-term care, dental care, or
eye glasses.
How do I choose?
When
deciding on a plan, it’s essential to compare the benefits and costs in
relation to your specific health care needs. With Medicare Advantage plans, you
must continue to pay your Part B monthly premium, in addition to the monthly
premium for your plan. However, although Medicare Supplement plan benefits are
standardized, costs can vary between plans with the same benefits and are
generally more expensive.
When
comparing the benefits and costs of plans in your area, be sure to take these
key factors into consideration:
- Deductibles
- Monthly premiums
- Anticipated costs of health
care and hospital services you use often
- Restrictions on doctors,
hospitals, and pharmacies
- Expected costs of prescription
drugs that you require regularly
- Maximum out of pocket amounts
Can’t I have both?
No,
Medicare Advantage plans do not work with Medicare Supplement plans. This means
that you cannot use your Medigap plan to take care of the copayments,
premiums, or deductible from your Part C Medicare Advantage plan.
What if I choose Medicare Advantage?
If
you decide to enroll in a Medicare Advantage plan after being in Original
Medicare (Part A and Part B) for some time, you may want to cancel your Medigap
plan since it cannot be used to pay for Medicare Advantage costs. If you do
drop your Medigap plan in this scenario, you have a guaranteed right to
purchase another Medigap policy if you decided to disenroll from the Medicare
Advantage plan while you are still in a “trial period.” In most cases, a trial
period lasts for twelve months after a person enrolls in a Medicare Advantage
plan for the first time.
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