Medicare Supplement vs. Medicare Advantage: What’s covered?

Should I choose a Medicare Supplement plan or a Medicare Advantage plan?

What’s covered by Medicare Supplement vs. Medicare Advantage?
Original Medicare is replaced by Medicare Advantage plans (Part A and Part B). The insurance company, not Medicare, provides all of your health coverage when you purchase a Medicare Advantage plan. You don’t lose any benefits as a result of this. In reality, most Medicare Advantage plans cover routine vision and dental treatment as well. Prescription medicine coverage is almost universally included.

You must obey the rules of your plan in exchange for these additional perks. Using only recognized network providers and obtaining prior authorisation for certain tests and treatments are common examples of these standards.

Original Medicare is supplemented by Medicare Supplement programs. Part A and Part B of these plans cover the majority of your out-of-pocket expenses. Medicare continues to provide health insurance, but your Medicare Supplement plan covers your deductible and coinsurance.

With Medicare Supplement plans, you normally don’t get any additional benefits. If Medicare doesn’t cover a service, your Medicare Supplement plan won’t either. For an additional monthly fee, some plans offer stand-alone vision and dental policies. A few plans even give additional advantages at no cost.

Part D out-of-pocket payments are not covered by Medicare Supplement plans. The deductible and coinsurance are your responsibility if you purchase a Part D plan.

There are no restrictions on Medicare Supplement plans, such as provider networks or prior authorization. You can utilize your plan with any Medicare-approved provider.

What are the differences between Medicare Advantage and Medicare Supplement plans in terms of costs?
You must continue to pay your Part B premium regardless of which Medicare plan you choose. If you’re one of the few people who still pays for Part A, you’ll have to keep paying it.

Premiums
Medicare Supplement plans have a separate monthly cost. Your premium is determined by the plan you select, as well as your age, location, sex, and other considerations. Premiums normally run from $50 to $250 per month, and they often go up as you get older.

Some Medicare Advantage plans have a monthly payment, although the majority of people opt for a plan with no monthly premium. The average monthly price for individuals who pay a premium is $25, which usually includes Part D coverage.

Deductibles
Unless you choose a high-deductible plan, Medicare Supplement plans do not have an annual deductible. After you satisfy the Part B deductible, most Medicare Supplement plans cover your Part A deductible and coinsurance, as well as 100 percent of your Part B expenditures.

If you choose a high-deductible plan, after you pay $2,340 out of cash, your insurance will cover 100% of your costs.

Although Medicare Advantage plans may or may not have an annual deductible, the majority of people can choose a plan with no deductible. Part D has its own deductible in some plans.

Shared expenses
The majority of Medicare Supplement plans have no copayments. This means that the plans will cover your Part A inpatient and Part B coinsurance in full. You pay a minimal copayment at the time of service if you choose Plan N. For doctor appointments, the cost is usually $20 or less, and for emergency department care, it is usually $50 or less.

Medicare Advantage plans typically have a fixed copayment for health services. In a typical HMO plan, primary care visits cost $5, specialist visits are $25, and urgent care and emergency department visits are $50.

Maximum out-of-pocket
Only two Medicare Supplement plans, Plan K and Plan L, include out-of-pocket limits. Until you hit the out-of-pocket maximum, these two plans pay between 50% and 75% of your Part A and Part B coinsurance. Following that, they will cover 100% of your expenses. Plan K and Plan L have out-of-pocket maximums of $6,220 and $3,110, respectively, in 2021.

An out-of-pocket maximum applies to all Medicare Advantage plans. Once you’ve reached it, your insurance will cover all of your expenses in full. Each year, Medicare sets the maximum limit, but most plans set their maximums lower than Medicare’s. The average Medicare Advantage out-of-pocket limit in 2021 will be around $5,091.

What is the difference between a Medicare Advantage and a Medicare Supplement plan?
Most people’s decision between Medicare Advantage and Medicare Supplement is influenced by three factors: flexibility, predictability, and additional benefits.

Flexibility: If you want to travel or spend part of the year in another state, you must be able to access health care regardless of where you are. Most Medicare Advantage plans require you to use a provider network that has been approved by Medicare. A Medicare Supplement plan, on the other hand, allows you to be treated by any Medicare-approved practitioner.

Predictability: You only pay your monthly payment and your Part B deductible with the most popular Medicare Supplement plans. Original Medicare covers 100 percent of your other out-of-pocket expenses. That means you’ll know exactly how much your monthly health care will cost.

You pay a fixed copayment at the time of service with Medicare Advantage. For most outpatient services, these copayments range from $5 to $75. If you choose a $0 premium plan and don’t need health care, you may pay nothing at all for some months. You’ll never pay more than the out-of-pocket maximum set by your plan.

Extra features: The majority of Medicare Supplement plans do not include any additional advantages, while a few do, such as SilverSneakers or another fitness membership. You may be able to purchase separate vision and dental coverage for a monthly fee. Only a few plans include vision and dental coverage as part of the monthly fee.

Although most companies that sell Medigap plans also provide Part D, no Medicare Supplement plans contain it.

Prescription drug coverage is included in most Medicare Advantage plans. SilverSneakers and benefits for routine vision, dental, and hearing care are included in the majority of plans.

New perks have been added to some programs. Allowances for over-the-counter drugs and gadgets, home meal and grocery delivery, and non-medical transportation are among the most prevalent. These advantages come at no additional expense.

Considerations at the end
Medicare Supplement plans differ from regular Medicare plans in that coverage is only guaranteed in certain circumstances. You have assured issue rights during your Medigap Open Enrollment Period. This implies that you can purchase any plan available in your state and will not be denied coverage or charged more because of a preexisting condition.

You can still apply for a plan outside of that time frame, but you’ll almost always have to pass medical underwriting before being approved. If you have a serious or chronic illness, the insurance company may refuse you, provide you a plan with reduced coverage, or charge you much higher premiums.

A Medicare Advantage plan, on the other hand, can be purchased by anyone who is qualified for Medicare, regardless of their health status. Another advantage is that if you choose a plan and then decide you don’t like it, you can change it or return to your Original Medicare without penalty.

During the fall Annual Election Period and the Medicare Advantage Open Enrollment Period, you can make adjustments twice a year. It’s vital to remember that you won’t be able to get Medigap coverage during these times.

If you believe a Medicare Supplement plan is correct for you, you should purchase it during your Medigap OEP when you first become eligible.