The Difference Between Medicare Supplement and Medicare Advantage Plans

The Difference Between Medicare Supplement and Medicare Advantage Plans

The Difference Between Medicare Supplement and Medicare Advantage Plans

Most individuals report being generally satisfied with their Original Medicare apart from two things:

  1. Unforeseeable out-of-pocket costs and
  2. the absence of vision and dental insurance coverage.

Medicare Part C can help with these concerns, yet there are advantages and disadvantages to both types of policies. On the one hand, there are Medicare Supplement plans (also called “Medigap” plans), and, on the other, there are Medicare Advantage plans. Which is better?

The answer to that is: it depends. In this post, I will outline some of the major differences between Medicare Supplement and Medicare Advantage plans to give you a better idea of what they are, what they tend to do, and what you should do to make an informed decision in choosing between them.

Apples to Apples Comparison

Below is a comparison between Medigap and Medicare Advantage plans in terms of choice in provider, premium costs, coverage, referrals, and how accessible specialists are to you.

Choice in Provider

  • Medicare Advantage: Requires you to use health care providers in the plans’ network or you need to pay out-of-pocket.
  • Medicare Supplement: You can utilize any doctor or hospital that approves Medicare, with no network to be considered.

Premium Costs

  • Medicare Advantage: An average of $21 a month costs (for 2021) in addition to your Medicare Part B premium.
  • Medigap: The typical Medigap premium expense is $2,100 each year ($175 monthly), and covers approximately $1,600 in out-of-pocket costs annually, on average.


  • Medicare Advantage: Covers Medicare Parts A and B, but most provide extra benefits, including vision, dental, hearing, and prescription drugs.
  • Medigap: You still have Original Medicare Parts A and B, and the choice of 8 different Medigap plans, each offering different degrees of coverage.

Prescription Drug Coverage

  • Medicare Advantage: Plans likely include prescription drug coverage.
  • Medigap: Does not provide coverage for prescription drugs, so you have to buy separate Medicare prescription drug coverage, also known as Medicare Part D.

Referrals & Specialists

  • Medicare Advantage: You may be obligated to get a referral from your medical care doctor to see a specialist.
  • Medicare Supplement: Referrals from your primary care physician are not required.

It comes down to which is best for YOU

Generally, if you remain in good health with few medical expenditures, Medicare Advantage is a money-saving option. But if you have major medical problems with costly treatment and care costs, Medigap is usually far better.

Speaking to an insurance agent concerning your particular health circumstance can help you decide which is best for you. Given that you are not permitted to have Medicare Advantage and Medigap at the same time, you need to pick very carefully to make sure you have appropriate coverage for your specific needs. If you’re in Oregon, feel free to consult with either Bend Health Insurance or Eugene Health Insurance.

Considering what options are important to you and talking with a licensed insurance representative about your specific wants and needs can help you make an informed selection between Medicare Advantage and Medigap.

Pros for Medicare Advantage Plans

Medicare Advantage plans generally have lower monthly premiums than Medigap. They might additionally include prescription drug coverage. You need to register in a separate drug plan if you go with Medigap.

If dental or vision coverage is important to you, you could select Medicare Advantage, since Medigap doesn’t assist with these services. Medicare Advantage might additionally be much better for you if you are flexible to which doctors you are willing to see since you will have to use in-network healthcare service providers to cut out-of-pocket expenses.

Pros for Medicare Supplement Program

Medigap helps cover your out-of-pocket costs if you choose to stick to Medicare.

The most significant advantage of Medigap may be your option of doctors. You have physicians and medical facilities to choose from because you can most likely to any kind of service provider that approves Medicare.

If your physician is not in a Medicare Advantage plan you’re considering, and you don’t intend to change physicians, you might want to consider Medigap. This will allow you to see any type of medical professional who accepts Medicare.

While Medigap costs are typically greater than Medicare Advantage, Medigap will likely charge you reduced out-of-pocket expenses. You’ll need to determine how much you anticipate spending for healthcare over a year and compare that to your annual premium cost.

Finding a Medigap plan that works for you can be less complex since there are only eight types to choose from. This can simplify enrolling in Medicare.

Key Takeaways:

  • You have to choose either a Medicare Advantage or a Medigap plan. You can not have both.
  • Most Medicare Advantage plans consist of Medicare Part D and various other added advantages.
  • Medicare Supplement plans can not be utilized to pay your D prescription drug expenses.
  • One of the most popular Medicare Supplement plans pay 100% of your out-of-pocket costs with An and B, except for the Part B deductible.
  • All Medicare Advantage cap your annual out-of-pocket expenses.

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