Until 2010 when Medicare Advantage is discontinued, it pays to know the differences between Medicare supplement plans and Medicare Advantage.
It’s a fairly straightforward difference between Medicare and Medicare Advantage, and it basically boils down to the majority of an individual’s health care expenses is covered by Medicare. For example, Medicare part A will cover inpatient care at places like a hospice, skilled nursing facility or a hospital.
Medicare part B takes care of doctors and outpatient services, while part D handles prescription drugs. One thing to remember is that parts B and D mean paying a premium. While it looks like Medicare covers a whole lot, it doesn’t cover everything. This is where Medicare supplements or Medicare Advantage steps in if a person or family wants 100% of their health care covered.
If a person opts to buy Medicare supplements, they are purchasing a “gap” policy that fills in the holes in the original Medicare plan, usually referred to as a Medigap policy. With these particular policies, there are various levels of coverage in 12 different plans with alphabet designations A through L. Each one of these letters provides a different kind of supplemental health coverage and the prices are unique, based on the different levels.
Medigap health insurance is offered by private health insurance companies and there is a monthly premium to be paid. Usually the premium is dictated by the level of coverage, age of the insured and their zip code. As with many other things in life, these plans usually have a price increase yearly.
With the Medicare supplement policies there are usually open enrollment periods and a person is able to get guaranteed enrollment. If an application is not made during the open enrollment period, the usual health insurance underwriting routine applies.
Medicare supplements are additional coverage. Medicare Advantage is replacement coverage. To file a claim under a Medicare supplement policy, a person must file a claim with Medicare and the supplemental insurance company. In the case of Medicare Advantage, the claim is processed by the policy provider.
Medicare Advantage also currently provides many choices such as a PPO, FFS or HMO and right now plans are available to suit an individual’s personal preferences and what is still being marketed in the applicable zip code. All this will change when Medicare Advantage is no longer offered in 2010. Now is the time to speak to a local Medicare health insurance provider to find out what other alternatives will be available to replace Medicare Advantage.