The Key Difference Between Medicare Supplement and Advantage Plans

Are you eligible for Medicare, or will you become eligible soon? Are you wondering about the benefits of Medicare supplement plans? And how does Medicare Advantage work?

Medicare can provide you with excellent health coverage once you’re sixty-five or older. Yet for those who have ongoing needs, additional plans could provide you with coverage that could save you a good deal of money in the long run.

Here’s what you need to know about the difference between Medicare supplement and Advantage plans.

What Is Medicare?

Medicare is a federal healthcare program for those sixty-five and older, as well as some younger people with disabilities. You are eligible for premium-free Part A Medicare if you’re over age sixty-five and you or your spouse have worked and paid Medicare taxes for ten years or more.

Part A of Medicare will cover hospital stays and skilled nursing facilities. In some cases, it will also cover hospice care and some home health care.

Part B of Medicare covers doctor visits, outpatient care, preventative services, and medical supplies. While most people don’t pay a premium for Part A, most will pay a premium for Part B.

As of 2021, the standard premium you’ll pay for Part B is $148.50. If you get your payments from Social Security, the Railroad Retirement Board, or the Office of Personnel Management, your premium will be automatically deducted.

What Are Medicare Supplement Plans?

A Medicare supplement plan can help you pay for some of the costs that aren’t covered by Medicare, including copayments, coinsurance, and deductibles. You can compare Medicare supplements and see which ones are right for you.

You may, for example, wish to get more coverage for skilled nursing facility coinsurance. Or maybe you travel overseas often and want coverage for foreign care emergencies.

You’ll need to take a number of things into consideration when choosing between supplement plans. For example, you’ll want to think about how much you typically pay for hospital stays or doctor visits.

If you have other coverage, you’ll want to know how it works with Medicare. What are your out-of-pocket costs, such as coinsurance and copayment?

You’ll also want to think about your prescription drug coverage. How much do you usually pay for prescription drugs? Are you currently covered, or would a supplement with drug coverage really help reduce the strain on your wallet when all is said and done?

In addition, it’s important to consider the doctors and hospitals you’re currently comfortable with. Will they accept your coverage? Or will you need to find new physicians?

Other factors that come into play are the frequency with which you travel and the quality of care you want to receive. It’s important to carefully consider all of your priorities and expenses before you decide which Medicare supplement plan is best for you.

What Is Medicare Advantage?

Medicare Advantage plans are offered by private companies approved by Medicare. They offer an “all-in-one” alternative to traditional Medicare. Advantage plans include Medicare Part A, Medicare Part B, and usually Medicare Part D, which includes prescription drug coverage.

Advantage plans normally cover things that traditional plans won’t cover. These include some dental, vision, and hearing coverage. You may also get coverage for fitness programs such as gym memberships or discounts.

Some Advantage plans also offer additional coverage that includes over-the-counter drugs and transportation to doctor visits. They can get tailored to meet the needs of those with specific conditions or chronic illnesses.

Medicare Advantage plans will require you to pay a fixed amount each month, as well as varying out-of-pocket costs. The actual cost of your Advantage plan will depend upon a number of factors. In many cases, you’ll be required to use doctors who are in the plan’s network for the lowest costs.

What Is the Difference Between Medicare Supplement and Advantage Plans?

Most Medicare supplement plans won’t work with Medicare Advantage plans. You’ll need to choose one or the other if you want more tailored Medicare coverage.

Both types of plans are offered by private insurance companies that are approved by Medicare. However, there are certain differences to consider.

With supplemental insurance plans, for example, you’ll be paying a monthly premium that adds to your Part B premium. However, you may have lower out-of-pocket costs.

With Medicare Advantage, you will have little or no money to pay in addition to your Part B premium. However, you may be responsible for co-pays, coinsurance, or deductibles.

Medicare supplemental insurance plans generally allow you to see specialists without a referral. With Medicare Advantage, you may need referrals and need to stay in-network for doctors, hospitals, and specialists.

With Medicare supplemental insurance plans, your prescription drug coverage may not be included. Yet most Medicare Advantage plans include prescription drug coverage.

Another main difference between the two is enrollment. With supplemental insurance plans, you can apply anytime after you turn age sixty-five and are eligible for Part B. With Medicare Advantage, you can only enroll during specific times of the year.

The plan you choose will depend largely upon your preferences and medical needs. It’s important to consider all restrictions before deciding on your coverage.

Staying Covered

What’s the difference between Medicare supplement and Advantage plans? Both will cover many of your medical needs, but each has different advantages in terms of coverage and doctor choice. With the right research and budgeting, you could find a healthcare plan that’s just right for you.

Don’t stop getting smart about your finances and health now. For more great advice, read our blog today.