4 Points to Help You Choose Between Medicare Advantage and Medigap

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Financial planning for your retirement years has to include solid provisions for medical insurance because health issues keep increasing with age. When you become eligible for Medicare and get enrolled into Part A and Part B, you will get your medical coverage through these Original Medicare plans. Part A covers the hospitalization costs and Part B provides the coverage for doctor visits, lab tests etc.

You can also get your Medicare benefits through Medicare Advantage plans sold by private insurance companies. These plans cover all the benefits that are covered under Original Medicare and some additional ones. So, some people prefer to get their Medicare benefits through Medicare Advantage.

You can either get your benefits through Original Medicare or Medicare Advantage. However, people who keep Original Medicare tend to buy a supplemental plan, Medigap, and Part D to cover prescription drugs. This combination makes Original Medicare quite comprehensive and comparable to Medicare Advantage.

Since you cannot use Original Medicare and Medicare Advantage together, you need to decide which arrangement works out better for you. When you add Medigap to Part A and Part B, that makes all the difference and it is by actually comparing Medigap with Medicare Advantage that you can arrive at a conclusive decision.

Comparing Costs

When it comes to costs, Medigap plans are more expensive than Medicare Advantage. The most popular Medigap plan, Plan F, can be up to three times more expensive than a standard Medicare Advantage plan.However, you have to pay more out-of-pocket expenses for Medicare Advantage. But these out-of-pocket expenses have a fixed maximum limit. Most of the Medigap plans do not have any fixed limit on out-of-pocket expenses.

Comparing Coverage

Medicare Advantage coverage includes vision, hearing and dental care. None of the Medigap plans cover these benefits. Medicare Advantage also offers prescription drug coverage which is not provided by Medigap.

Comparing Convenience of Usage

Buying a Medicare Advantage plan is more complicated simply because there are many more choices and options for these plans. It is easier to choose a Medigap plan since there are only ten plans to choose from and every insurance company has to offer the same coverage for a particular plan. On the other hand, it is easier to use Medicare Advantage because it covers all the benefits under one plan and you don’t have to carry separate plans.

Comparing Provider Services

This is one area where Medigap scores higher than Medicare Advantage. There are no limitations on the providers under Medigap as long as the provider accepts Medicare. Medicare Advantage plans have definite network of providers and members have to take the services from them in order to get coverage.

If you can manage the higher premiums of Medigap, it may be more advantageous to buy these plans. If you have to visit the doctor often then Medicare Advantage is better because here the out-of-pocket expense limits are fixed.

Every individual has different medical needs and a budget for that. You need to collect detailed information about benefits and costs for the exact plans that you are considering. The state health department of insurance or individual agents can give you relevant information and guidance to help you decide which plan is best suited for you.