Note that things change every year in the world of US Medicare plans. Medicare.gov and qualified, certified, and licensed local Medicare health insurance agents are great resources. I am not attempting to explain or promote any particular Medicare health plan here. I am simply trying to outline the basic differences between Medigap and Medicare Advantage (MA) plans. I will provide some clarifications, graphics, and links to resources where you can get more information on specific topics.
Video: Medicare Advantage vs. Medicare Supplement Insurance
Why the F Medicare Supplement Plan Works Best
Your mailbox is full. After turning 64 and 1/2, you’re suddenly the most popular person on the block and the poor mailman can barely find room to stuff all those shiny brochures into the box. In terms of Healthcare, turning 65 really is a second birthday welcoming you to the world…of Medicare. Assuming you don’t have a better group option or other coverage, Medicare should reflect a significant reduction in your out of pocket medical expenses and a big part of this is the Medicare supplement insurance plans that works in conjunction with traditional Medicare. Let’s take a look at these plans and how they differ but most important, look at which plans stand out as best options to cut through some of that mailbox overload where everyone’s trying to sell you something. First, a quick introduction is in order. The Medicare supplements plans are different from Advantage plans, the other primary option available on the market. The Advantage plans are typically less expensive on a monthly basis (if not free) but have more constraints on how care is accessed (like traditional HMO”s) and share more medical costs that are incurred as a trade off. This last piece is an important distinction which we’ll address in more detail with our Medicare supplement versus Advantage article, but let’s stay with Medicare Supplemental plans for now. The supplements in a nutshell, fill in the holes of traditional Medicare with the deductibles (physician and hospital) plus the 20% co-insurance being the primary financial pitfalls of original Medicare. This filling in of the “gap” inherent in traditional Medicare is why these policies are interchangeably referred to as “Medigap” plans. There are other smaller gaps in traditional Medicare but these two, especially the 20% coinsurance can really pose a problem without supplemental coverage. The Supplement’s coverage increase from alphabetically from A to K with a few letters missing in the middle. The traditional supplements run A, B, C, D, and F. These have been pretty established for decades now. Make a mental note on the F plan as that tends to be the darling of the Medigap world. Let’s discuss the really critical pieces of Medicare in terms of gaps we need to fill now that medication is taken care of with Part D. We want to make sure that we do not have uncapped exposure to medical expenses especially since we are more likely to see facility based care (loosely translated as very expensive) as we get older. Fixed deductibles are one thing but an unlimited percentage of a $50K bill is quite another not to mention $250K of charges over a year’s time. Granted, the medicare supplement plans cover the 20% coinsurance but let’s look at excess. This is critical. Excess is the amount that providers can charge above the allowed Medicare rate and it amounts to 15%. With more pressure on the finances of Medicare going forward, the trend of providers charging this excess amount will likely intensify. This becomes a primary concern for Medicare recipients looking to protect themselves and the F plan becomes are plan of choice to cover this excess charge. Now let’s look at all the high deductible and/or fixed max out of pocket plans. Here’s the issue. These plans will be less expensive in terms of premium for sure but we’re entering a period of time when the likelihood of hitting any high deductible or max out of pocket is at it’s highest. On average, health care expenditures increase with every decade of a person’s life so to be conservative, let’s assume at some point we will hit the full deductible or max out of pocket. Now the premium savings isn’t such a good offset against the richer benefits of the F plan. If you’re gambling on being healthy and keeping the premium savings, the house might have the odds against you. The problem is that we likely will be unable to change plans if health deteriorates so we’re really making a decision for a long period of time. Again, in the long run, this points to the F plan. Obviously, you need to find the right plan for your health and financial situation but definitely keep in mind both current and future concerns. The future is right around the corner.
Navigating The Medigap and Medicare Advantage Maze
The Medicare maze is long and twisting. Understanding the reason you are taking the path you are on is something that is necessary to ensure your coverage is up to par with your needs. The reason Medicare is often confusing to many is because of the choices you are given in regards to health care plans. One major obstacle is to determine if you would rather choose Medicare with Medigap Supplement Insurance plans or choose an all inclusive option such as Medicare Advantage. It is important to understand both options thoroughly to know if you are making the right choice. First let’s talk about Medicare Advantage. Often times at first glance the Medicare Advantage program looks like a cheaper option for better coverage. This may not always be the case though. The one thing about the Medicare Advantage program is that the premiums may increase over time and you are locked into them. Another item to think about is the often higher co-pays that come along with the Medicare Advantage plans. This plan is ideal for candidates whom already have a doctor in the network caring for them. With Medicare Advantage you need to choose who you see based upon who contracts with Medicare to provide you coverage. Not all doctors are covered. This is true in regards to specialists as well. You must see a doctor that has a contract within the Medicare network of doctors. Medigap refers to the plans that fill in the holes left with traditional Medicare Part A and Part B. Medigap Supplemental Policies are identified using a letter of the alphabet. It is insurance that is sold through private insurance companies. Something to be aware of however is that the government has standardized each Medigap Plan. This is important because although the health insurance companies may have a different price on the plan the coverage and benefits you receive are the exact same from company to company. This makes comparing policies a bit easier because you know that no matter what the Medigap Plan is going to be the same no matter where it is purchased. The decision really comes down to a company and price you are willing to purchase the insurance from and which plan out of the available plans fills in the holes left by Medicare that you need filled in. When looking into insurance companies to purchase a Medigap policy from make sure to compare the rates of several companies. It is important to note that some insurance companies add in a clause that the premiums will or will not rise with age. Many plans increase rates with inflation however it is best to find a company whom has a reasonable price for their coverage, good service and a clause that the premiums will not raise because of the participants age bracket. Otherwise the limited income you are living on could need to feed a higher Medigap premium in the future. Choosing a Medigap Supplement Insurance plan is not an easy thing to do. Many online sources offer side by side comparisons of the different options available with not only a plan comparison but a cost comparison quote from several insurance companies. IT is best to work online with a company that offers online support as well as telephone support when look into compare rates and view Medigap plans. This was if a question come up you will be able to have it handled promptly. It also helps remove impassable paths to get you to the finish line sooner in the Medicare maze.
Medigap vs Medicare Advantage
On the other side of Medigap vs Medicare advantage, the Medicare Advantage plan is also offered by the insurance company and this offers standard hospitalization and coverage of both Parts A and B. In certain cases, this could include services beyond the Original Medicare. Therefore, with Medigap vs Medicare advantage, MA has an advantage in terms of the extent of coverage since it can cover beyond the basic plan where supplemental coverage only offers added coverage to existing plans. The MA comes in PPO and HMO formats, both managed care plans. With HMO, you have to work with doctors within their preferred network while PPO allows you to choose your preferred doctors.
NEW TO MEDICARE!! WHAT ARE MY OPTIONS »
Step #1: Decide if you want “Original Medicare” or a Medicare Advantage plan. Talk to your doctor and see which plan he/she recommends. Many doctors are accepting “Original Medicare” and not Medicare Advantage plans. If you have a doctor that is in the Medicare Advantage plan’s provider directory, make sure you call to verify that he/she is still accepting that particular Medicare Advantage plan. Sometimes providers are in the directory, but stopped accepting the plan long before it went to print. The main difference between “Original Medicare” and Medicare Advantage plans is “Original Medicare” works only with Medicare and generally, you or your supplemental coverage pay the deductibles or coinsurances.
The Difference Between Medicare Advantage Plans and Medigap
Medicare and Medigap are often given a bad name because so many people are tricked or told to get the wrong types of policies that leave them in a lurch. The problem here is just as much about educating Medicare policyholders as it is making the Medicare fraudsters go away. There are a few things that could help you not make a mistake when getting your Medicare or Medigap coverage going, especially to ward off fraudsters.
Medicare, “Medigap” and Medicare Advantage Plans
Yes. Another example: Citing language in the ACA, the Department of Health and Human Services has exempted Medicare Supplement carriers from so-called “rate review rules.” This means that Supplement carriers will be free to increase the rates and premiums they charge for the coverage without HHS oversight. This exemption will become important in a few years, when the ACA’s “guaranteed issue” standards are fully implemented. At that point, people will probably be paying more for Medicare Supplement coverage, even though the plans will likely cover less.
Will Senior Medical Plans Cover Overseas Travel?
There are quite a few retirement site that suggest getting international travel insurance to cover some issues that you may have while traveling to other countries. Some of these plans actually do include medical care and medical evacuation. This means you should have access to local doctors and hospitals. If you happen to travel to an area without good medical services, an evacuation policy can pay to fly you to a good facility. Some may even pay for the expenses to get you back to the US so you can get healed at at home.
Solutions For Medicare Problems
If you elect to delay your Medicare B enrollment past your 65th birthday because you have group health insurance through your employer, that is not a problem. Just be aware that when you do retire or lose your group coverage for any reason, you do not have the full 7 month Initial Enrollment in which to secure a guaranteed issue Medigap plan. You qualify for a Special Enrollment Period for only 63 days. If you have a pre-existing health condition that would prevent you from medically qualifying for Medigap, you will need to submit your application within 63 days of the Medicare B effective date on your Medicare card.
Medicare Advantage Plans in 2013 will be Different
Secure Horizons is a premiere healthcare company that offers only the best in Medicare Supplement insurance. They make it fast and easy to find what you need, get the coverage you need fast, and find a doctor in your area. They offer options such as Medicare Advantage Plans, Prescription Drug plans, and other extra services. Their services are offered as part of UnitedHealth Group, and take pride in being able to offer all of the services you need at affordable rates. They are extremely dedicated to finding the best plans for their customers across the country.
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