Medicare Advantage vs. Medicare Supplement: Which Should You Choose?
When you turn 65 years of age, you automatically become eligible for Medicare. One of the most important decisions you’ll have to make when turning 65 and becoming automatically eligible for Medicare is whether you should choose a Medicare Advantage plan or a Medicare Supplement (Medigap) plan. Both of these options are geared towards helping you properly cover the costs your original Medicare plan does not cover. However, they operate in different ways. Here at The Lambert Agency, we help our valued clients compare and contrast both options available to them when they turn 65 years of age. This guidance helps ensure the right choice is made when it comes to aligning with health needs, lifestyle needs, and overall budget constraints.
Understanding the Basics
Medicare Advantage (Part C)
Medicare Advantage plans will be offered by private insurance companies which are approved by Medicare. Medicare Advantage plans combine Parts A (hospital coverage) and B (medical coverage). Additionally, they’ll often include Part D (prescription drug coverage). Some Medicare Advantage plans will offer additional extras consisting of vision, dental, and hearing coverage options. Medicare Advantage plans include the following attributes for most individuals:
- Lowered monthly premiums
- Network restrictions (HMO/PPO) could limit which doctors and hospitals you can visit and be seen at
- Out-of-pocket costs such as copays and coinsurance will still apply
- Often includes extra perks with the plan such as fitness programs or telehealth options
Medicare Supplement (Medigap)
Medigap plans will often work alongside your original Medicare plan. Choosing to keep Medicare Parts A and B, while also adding a Medicare supplement plan will assist in paying for deductibles, copays, and coinsurance expenses. Medicare Supplement plans will often include the following:
- Increased monthly premiums, yet reduced out-of-pocket costs
- No network restrictions applied (see any doctor or hospital you see fit which accepts Medicare nationwide)
- Prescription drugs are not included (a separate Part D plan is required)
- Consistent, predictable healthcare costs with less of an overall financial risk
Key Differences Between Medicare Advantage & Medicare Supplement Plans
- Costs
- Advantage: Lower premiums, yet higher potential out-of-pocket costs
- Supplement: Higher premiums, yet most costs will be covered
- Advantage: Lower premiums, yet higher potential out-of-pocket costs
- Doctor & Hospital Choice
- Advantage: Must use the plan’s network, except in cases of emergency
- Supplement: Any Medicare-accepting provider in the U.S. qualifies
- Advantage: Must use the plan’s network, except in cases of emergency
- Coverage Extras
- Advantage: May include associated dental, vision, hearing, and wellness perks
- Supplement: Strictly covers medical costs; extras are not included
- Advantage: May include associated dental, vision, hearing, and wellness perks
- Travel Coverage
- Advantage: Limited coverage, with often no available coverage outside of your specific service area
- Supplement: Nationwide coverage, with some plans covering foreign travel emergencies
- Advantage: Limited coverage, with often no available coverage outside of your specific service area
- Simplicity vs. Flexibility
- Advantage: An all-in-one plan which is easier to manage, yet still has its limitations
- Supplement: Can be more flexible, yet requires pairing with Part D and possibly dental/vision coverage
- Advantage: An all-in-one plan which is easier to manage, yet still has its limitations
Which Should You Choose?
Ultimately, the right choice comes down to your overall health, anticipated budget, and preferred lifestyle. Here at The Lambert Agency, we will always recommend asking yourself the following questions to help determine the right choice:
- “Do you want to lower your premiums now, knowing you’ll have to eventually pay copays and coinsurance along the way?”: Medicare Advantage could be a good fit for you
- “Do you prefer a form of predictable, comprehensive coverage with the freedom to see any doctor you’d like?”: Medicare Supplement may be the better choice
- “Do you travel often or split time between residences in different states?”: Medigap does in fact offer nationwide flexibility
- “Do you like the idea of extras like vision, dental, and gym memberships included?”: Medicare Advantage is able to provide those perks
FAQs
“Am I able to switch between Medicare Advantage and Medicare Supplement?”
Yes, you can, but it’s not always the easiest task. Medicare Advantage plans may be changed during the annual enrollment period, but you’ll want to consider that switching to a Medicare Supplement plan may require additional medical underwriting, unless you happen to be within the initial enrollment window.
“Which option costs more over time?”
It ultimately depends on a couple of factors. Do you have frequent medical care needs? If so, a Medicare Supplement plan may end up saving you money over the long-term. If you’re a healthy individual and would like lower premiums, Medicare Advantage can be the right choice for you.
“Does The Lambert Agency help me compare both?”
Yes, we do! Here at The Lambert Agency, we’re happy to run side-by-side comparison models of premiums, estimated out-of-pocket costs, and levels of coverage so you can fully grasp what the outcomes may look like.
Contact The Lambert Agency Today
In summary, there’s not a one-size-fits-all approach when answering the question of Medicare Advantage vs. Medicare Supplement coverage. It boils down to your underlying health, your anticipated budget, and your preferred lifestyle. When you choose to work with The Lambert Agency, you’ll know we take the time to truly understand your unique situation and goals, and we’ll do our absolute best to provide you with the best options we see fit. Through these careful measures, we’re able to help you feel confident you’ve chosen the right Medicare coverage which aligns with your lifestyle.