What is the Difference Between Medicare Advantage and Medicare Supplements?

Medicare Advantage, also known as Medicare Part C, is sold by private insurance companies contracted with Medicare. Medicare Advantage plans cover the same benefits as Original Medicare, in addition to benefits such as prescription drug coverage. 

Medicare Supplements are also known as Medigap. They are sold by private insurers and help offset the out-of-pocket costs associated with Original Medicare. If you want additional coverage, you can choose between Medicare Advantage or a Medicare Supplement.

What Are They?

Medicare Advantage plans are another option for Medicare coverage. Private insurers sell them, and they cover the same services Original Medicare does. Part C covers inpatient and outpatient hospital services, as well as extra benefits that cover prescriptions, dental, hearing, vision, and gym memberships. 

Medicare Supplements are a standardized set of plans that cover the out-of-pocket costs associated with Original Medicare. Unlike Medicare Advantage, which can replace Original Medicare coverage, Medigap serves as supplemental insurance to Original Medicare.

Notable Differences

The main differences between Medicare Advantage and Medicare Supplements are coverage, eligibility, and function. To be eligible for Medicare Advantage, you must be enrolled in Medicare Part A and Part B. To qualify for Medicare Supplement coverage, you must also be enrolled in Part A and B. However, keep in mind that you cannot have both Medicare Advantage or Medicare Supplements at the same time. It’s either one or the other.

Also, some Medicare Advantage Plans limit their enrollment to specific people. For example, Special Needs Plans limit their enrollment to individuals who meet one of three categories:

• Eligible for both Medicare and Medicaid (D-SNP)
• Living in an institution, such as a nursing home (I-SNP)
• Have a chronic or disabling condition (C-SNP)

The costs of both insurance plans are also determined differently. Part C premiums vary depending on the provider and the plan you choose, and some Advantage plans do not have premiums. The cost of Medicare Advantage plans can also be affected by factors such as where you receive healthcare services. 

Premium costs for Medicare Supplements are ultimately based on the plan provider as they have one of three ways to determine the cost:

• Community-Rated
• Attained-Age-Rated
• Issue-Age-Rated

Also, if you enroll outside of the Medigap Open Enrollment Period, the insurer may charge you more based on your medical history. 

Coverage Differences

Under Medicare Advantage, you get coverage for all the healthcare services covered under Original Medicare. Many Advantage plans also offer coverage for prescription drugs as well as additional benefits, like dental, hearing, vision, and gym memberships. On the other hand, Medicare Supplements cover out-of-pocket costs associated with Original Medicare, such as copayments and coinsurance. 

Also, with Medicare Advantage, you must be within the plan’s service area to get the coverage. However, Medicare Supplements can provide coverage throughout the U.S., and some will even provide coverage outside of the country. 

Contact Jersey Medicare Solutions

Since it is not possible to have both plans at the same time, it is crucial to ensure you choose the best option that suits your medical needs. For more information, reach out to us at 973-500-3708.