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If you are new to Medicare, you may be wondering what the difference is between a Medigap plan and a Medicare Advantage plan.
Both types of plans can provide additional coverage beyond Original Medicare, but they work in different ways. Below is a break down of the differences between Medigap and Medicare Advantage to help you decide which option is right for you.
What is Medigap?
Medigap, also known as Medicare Supplement Insurance, is a type of private health insurance that can help fill in the gaps of coverage left by Original Medicare (Part A and Part B). Medigap plans are sold by private insurance companies and are standardized across the country, meaning that each plan offers the same benefits regardless of the insurance company you purchase it from.
Medigap plans are designed to work alongside Original Medicare, so you must be enrolled in both Part A and Part B to be eligible for a Medigap plan. Medigap plans can help cover out-of-pocket costs such as deductibles, coinsurance, and copayments, depending on the plan you choose. However, Medigap plans do not typically cover services such as prescription drugs, vision, dental, or hearing.
What is Medicare Advantage?
Medicare Advantage, also known as Part C, is an alternative to Original Medicare that is offered by private insurance companies approved by Medicare. Medicare Advantage plans provide all the same coverage as Original Medicare (Part A and Part B), but often include additional benefits such as prescription drug coverage, vision, dental, and hearing.
Medicare Advantage plans work differently than Medigap plans in that they replace Original Medicare as your primary insurance coverage. This means that you will receive all of your healthcare benefits through your Medicare Advantage plan instead of through Original Medicare. Medicare Advantage plans often have networks and may require you to use certain doctors and hospitals within the plan’s network in order to receive coverage.
What are the key differences between Medigap and Medicare Advantage?
The main difference between Medigap and Medicare Advantage is how they work. Medigap plans work alongside Original Medicare, providing additional coverage to fill in the gaps left by Original Medicare. Medicare Advantage plans replace Original Medicare as your primary insurance coverage, providing all the same benefits as Original Medicare plus additional benefits.
Another key difference between the two is the cost structure. Medigap plans often have a higher monthly premium than Medicare Advantage plans, but they also offer more flexibility in terms of provider choice and coverage. Medicare Advantage plans often have lower monthly premiums and may offer additional benefits but may also come with higher out-of-pocket costs for services received outside of the plan’s network.
Which one is right for you?
Deciding between Medigap and Medicare Advantage will depend on your needs and preferences. If you value the flexibility to see any provider who accepts Medicare and want coverage for out-of-pocket costs not covered by Original Medicare, then a Medigap plan may be the better choice for you. If you are looking for a lower monthly premium and are willing to accept network restrictions in exchange for additional benefits such as prescription drug coverage, then a Medicare Advantage plan may be the better choice for you.
Ultimately, the decision between Medigap and Medicare Advantage comes down to your individual priorities and budget. It is important to carefully review your options and consider all the factors before making a decision.