Choosing a Medicare plan can be really complicated. Understanding Medicare and all of the options can feel like an immense undertaking. Beyond understanding how all of it works, you then have to weigh how each option will affect you.
Today we will break down what your options are, how they can affect both your healthcare and your finances now and in the future and where you can turn for help if you are not sure what to do next or which plan will be best for you.
Medicare Advantage or Medigap?
The main difference between the two types of plans is that Medigap (also called Medicare Supplemental Plans) works with Medicare to provide your coverage while Medicare Advantage provides your coverage instead of Medicare.
Pros & Cons
Medicare Advantage Plans lower your Medicare share of costs to manageable copays and have a low or no premium. They also generally cover
Medicare Supplemental Plans have higher premiums but in many cases have very low or no co-pays. This option will give you more freedom of choice when it comes to service and care providers like doctors and hospitals. With supplement plans you also have very predictable costs because your monthly premium mah be all you pay. Lastly, you will have to buy a separate Prescription Drug Plan for pharmacy coverage.
How to Choose
There are a few main issues to look at that will give you a good idea of whether you are better off going with a Medicare Supplement Plan or a Medicare Advantage plan.
Choice: If you want more options choosing care providers and want to avoid having to get permission to see your doctors, the better option is a Medicare Supplement Plan.
Finances: The monthly cost for a Medicare supplement plan can often be more than you would pay in copays with a Medicare Advantage plan. Since many advantage plans have no premium, if you have options available with a good network of doctors then that will likely be the more affordable option.
Travel: If you travel often, especially far from home, you should consider a Medicare Supplement Plan. You will be able to see any Medicare provider anywhere in the country. With an Advantage plan you will only be allowed emergency room coverage.
Choosing a Medicare Supplement Plan
When you consider Medicare Supplement Plans, it is best if you have the help of a local Medicare insurance broker who can help you find the best options and best rates available. You will want to choose a plan that has the coverage you are looking for and then find the best rate possible. The rates of Medicare Supplement Plans can really vary based on factors such as:
- Age
- Gender
- Where You Live
- Discount Eligibility
- Whether You are a Smoker
There are many carriers for each Medicare Supplement Plan. Supplement plans with the same name will have the same coverage with every company. What varies will be the price. So using a Medicare insurance broker will ensure that you get the best rate possible.
Choosing a Medicare Advantage Plan
When it comes to choosing a Medicare Advantage plan, there are many options available as well. Some options include:
- Medicare PPO Plans
- Medicare HMO Plans
- Special Needs Plans
- Medicare Cost Plans
- Private Fee for Service Plans
One of the most important issues for many people when choosing a Medicare Advantage Plan is finding a plan that has your doctors and hospitals covered in network. Some Medicare Advantage Plans have very small networks, so it is important to be sure that you will have service providers available in your area.
It is also important if you are already on
Sorting through all of the choices in Medicare Advantage plans can be a monumental task. If you want to be assured that you are getting the right coverage at the best price, consult with a local Medicare insurance broker.
What is Better, Medicare Advantage or Medicare Supplement?
Your circumstances will determine what’s best for you. If money is no issue, the freedom and simplicity of a Medicare Supplement plan make for a great experience. More often than not, money is a consideration since many seniors are on a fixed income (only 20% choose to enroll into a Medicare Supplement plan). If you are in the middle, then confirm what your network options look like in your area to see if a Medicare Advantage plan is available that covers all your doctors and has competitive benefits that fit your needs. If so, it may make more sense to enroll into a Medicare Advantage plan. For those who absolutely cannot afford a Medicare Supplement plan, then it’s best to work with a broker to research all your options with a broker. We would say to consider a high deductible Medicare Supplement plan. They have a very low monthly cost (usually between $30-50 a month). They operate just like a normal Medicare Supplement plan, except that they have a deductible of $2370.00 each year. You essentially have just Original Medicare until you have paid out-of-pocket the deductible. Once the deductible is met you have the full version of the Medicare Supplement plan you purchased. We recommend you look at this option because of the low monthly cost, those who don’t have a lot of specialist spend, on average, only $600-1000 out of pocket, and in the worse case scenario you are only out a little more than $2400 for the whole year (essentially $200 a month).
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