Medicare Advantage vs. Medicare Supplement
Original Medicare includes two main parts that provide different types of healthcare coverage. Part A covers hospital care. Part B covers outpatient care. Putting them together is like completing a puzzle—but with a few pieces missing.
You have two options to help fill these gaps:
- Medicare Supplement (Medigap): A supplement to parts A and B
- Medicare Advantage (Part C): An alternative to parts A and B
While Medicare Supplement and Medicare Advantage plans work differently, both help pay for costs and services Original Medicare doesn’t cover. Here’s a comparison of these two options to help you figure out if one is right for you.
Differences Between Medicare Advantage and Medicare Supplement
Medicare Advantage and Medicare Supplement plans are both available through private insurance companies. Their key differences include:
| Features | Medicare Advantage | Medicare Supplement |
|---|---|---|
| Purpose | Another way to get Medicare Part A and Part B coverage. Your Medicare benefits flow through your Medicare Advantage plan, except for a few services Original Medicare still covers (such as hospice) | Supplements Original Medicare |
| Coverage | Covers everything Original Medicare Part A Inpatient Hospital and Part B Outpatient Medical coverage does | Pays for some of the out-of-pocket costs Part A and Part B don’t cover, such as deductibles, copays and coinsurance |
| Extra Benefits | Usually offers a range of extra benefits, such as dental, vision, hearing, transportation and fitness services | Usually does not cover extra benefits |
| Prescription Coverage | Usually covers prescription drugs on the plan’s formulary (list of covered drugs) | Does not offer prescription drug coverage—you’ll need to purchase a stand-alone Medicare Part D drug plan |
| Costs | Usually has low premiums but may have out-of-pocket costs for certain services (though there’s an annual maximum out-of-pocket limit for medical expenses) | May have higher premiums but covers most out-of-pocket costs |
| Part B premium | You pay your part B premium, but some plans help you pay a portion of the cost | You pay your Part B premium, but some plans help you pay all or part of the cost |
| Provider network | Usually, you have to receive medical care from healthcare providers within your plan’s network | You can see any doctor in the U.S. that accepts Medicare |
| Care outside the U.S | Some plans cover urgent and emergency care if you’re traveling outside the U.S. | Some plans cover emergency care if you’re traveling outside the U.S. |
| Specialist referrals | You may have to get a referral from your primary care doctor to see an in-network specialist. | You can see any specialist that accepts Medicare without a referral |
| Types | Insurance companies create Medicare Advantage plans with different costs and benefits. They may offer more than one plan in your area. | There are many types of Medigap plans (lettered A through N). Each plan has a Medicare-required set of benefits but not all plans are available everywhere. |
Is Medicare Advantage Better Than Medicare Supplement?
Both Medicare Advantage and Medicare Supplement plans are popular. About 50% of Medicare beneficiaries are enrolled in a Medicare Advantage plan, while another 20% have a Medicare Supplement plan.
The type of coverage you choose depends on your needs and preferences. You’ll need to weigh the costs, benefits, convenience and choices offered. Some things to consider when comparing your options include:
- Ability to see the doctors you want: Some Medicare Advantage plans limit who you can see for care or charge higher copays for an out-of-network provider. For the largest choice, or if you travel frequently in the U.S., a Medicare Supplement plan may be your best bet.
- All-in-one coverage: Medicare Advantage rolls all your benefits into one plan, which can be easier to manage. Most Medicare Advantage plans also include Part D coverage, so you won’t need a separate plan for prescription drugs.
- Benefits Original Medicare doesn’t cover: Medicare Advantage plans typically offer benefits you won’t get with a Medicare Supplement. Hearing, vision, dental and fitness benefits are common. You may also find plans that cover acupuncture, chiropractic care, over-the-counter products, transportation, home-delivered meals and more.
- Predictability of monthly costs: With a Medicare Supplement plan, you have a set monthly payment, although it can be expensive. With Medicare Advantage, your out-of-pocket costs vary based on the care you receive, up to your annual maximum limit.
- Stability of plan benefits: As long as you pay your premium, your Medicare Supplement coverage is guaranteed for life. Medicare Advantage plan benefits can change from year to year.
Enrolling in a Medicare Advantage or Medicare Supplement Plan
To be eligible for a Medicare Advantage or Medicare Supplement plan, you must be enrolled in Original Medicare Part A and Part B.
For Medicare Advantage, you have several opportunities to sign up:
- Initial Medicare Enrollment Period: This 7-month period includes the three months before you turn 65, the month of your birthday and the three months after.
- Medicare Advantage Open Enrollment Period: This period runs each year from October 15 to December 7.
- Special Enrollment Periods: These periods are for specific situations, such as if you move, lose your coverage or have a chronic health condition.
For a Medicare Supplement plan, you have a shorter window to enroll. Your Medigap Open Enrollment Period begins the first month you sign up for Medicare Part B and lasts for six months. If you miss this window, you may not be able to enroll—or it may cost more.
Can an Insurance Company Deny You for a Pre-Existing Condition?
Medicare Advantage insurers must accept you, regardless of any conditions you have. The same is true for Medicare Supplement plans, but only when you sign up during your Medigap Open Enrollment Period. After this time, an insurer may deny coverage or charge you more.
Switching From Medicare Supplement to Medicare Advantage
If you have a Medicare Supplement plan, you can switch to Medicare Advantage during Medicare Open Enrollment. Keep in mind, you may not be able to get the same Medicare Supplement plan back if you leave it. Companies can deny you for coverage based on pre-existing conditions or charge a higher premium.
Choose the Best Medicare Plan for You
The first step in finding a Medicare plan that’s right for you is to compare all your options. Medicare.gov is a great place to start. But be sure to check out the details of each plan on the company’s website.
At SCAN, you’ll find a wide range of Medicare Advantage plans with exceptional coverage and many added benefits. Use our online search tool to explore and compare options or contact us at 1-800-547-0887.
