What's Happening to Medicare and Medigap?

I find it surprising that over 48% of Medicare beneficiaries choose Medicare Advantage to help cover the costs of care that traditional Medicare does not pay for. And unfortunately, I also speak to many Advantage plan enrollees who are unsure of their coverage and other options. Additionally, many of these enrollees rarely take the time to really compare the cost and ease of use when making their selection. In fact, Financial Experts recommend a Medigap plan vs a Medicare Advantage plan based on the better coverage, the ease of use, and in a lot of cases the overall cost savings.

I would like to walk you through the pros and cons of both and suggest that each of you consider more accurately which is best for you. Of course, if you are out of the guarantee issue period, you may not have a choice, but for those of you who are approaching the initial enrollment period, and are healthy, then read on.

Medicare Advantage Plans

Medicare Advantage plans are government-regulated plans that are known as Part C. They have their advantages as well as disadvantages.

Advantages:

• Many of the plans come with no or very low cost premiums. 
• Many Advantage plans also provide other perks such as vision, dental, and gym memberships. However, I must caution you; you’ll always get what you don’t or do pay for. 

Disadvantages:

• Limits your care to in-network providers
• Often require pre-certifications to see a specialist and can be a time drain
• Can saddle enrollees with high out-of-pocket costs for those with serious conditions
• Can be a detriment to older enrollees as well as those with serious and complicated issues 
• Complex plan offerings and not standardized across the country. Plans are based on zip code and oit can be very overwhelming to get comparisons
• Additional costs for coverage may have extra associated costs such as drug deductibles, and specialist visit copays
• State-specific coverage offers the same coverage across the U.S. However, Medicare Advantage plans may offer only specific coverage in specific areas. If you move to another area, your current Medicare Advantage plan may be unavailable
• Your Advantage plan may lack coverage when traveling

How Not to Choose a Medicare Advantage or Medigap Plan

If you have an advantage plan when in good health and everything is working out splendidly,  consider what may happen mid-year or any time you are out of the initial enrollment period. If you become ill, especially if you have a serious illness such as cancer, you may not be able to switch to a Medigap or Supplement plan that may provide better coverage.

• Don’t allow the advertisers on tv to steer you to what is best for you
• Don’t sign up for something simply because your neighbor or friend says it’s what they have and they’ve been happy. They don’t know your current insurance needs, or your medical condition, and neither can they predict your future needs
• Don’t decide on premium alone: Consider all associated costs, benefits and limitations

Medigap or Supplemental Coverage

Medigap (or supplemental coverage) is extra insurance you can buy from a private insurance company to help you pay your share of out-of-pocket costs in Original Medicare.

Advantages: 

• You have guaranteed issue no matter your health status, your insurance can only be canceled due to non-payment
• There are 10 Medicare Supplement plans in 47 states that have the same standardized coverage
• Uses providers nationwide who accept Medicare
• Medigap plan benefits rarely change, so no annual reviews required 
• Does not have deductibles (all plans, except A, pay all or part of the Part A deductible) 
• No Co-Insurance (all plans cover Part A and Part B Coinsurance costs)
• All but three of the Medigap plans cover 100% of all copayments: The three that don’t have low copays or pay 50-75%
• Covers the gaps in original Medicare, including deductibles, copays, coinsurance, blood and foreign travel emergencies (up to the limits of the policy)
• Switch plans during your open enrollment period for another Medigap plan
• Easy to budget
• All plans offer an additional 365 days in the hospital

Disadvantages:

• Plans cannot include extra benefits such as dental, vision
• If enrolling outside of initial enrollment period, you will have to go through underwriting 
• Premiums will probably be more expensive and rates can vary from state to state
• Policies can vary widely
• You will need to get stand-alone drug insurance coverage
• Does not cover elective surgeries

As you can see or have experienced, there are many moving parts when deciding the best coverage for you. Timing is also everything when it comes to coverage opportunities. Taking the time to review your options, especially when new to Medicare, can prevent headaches down the road.

Reviewing your Medicare Advantage options yearly can help you uncover the best coverage for you.

If you are interested in connecting with one of our Financial Coaches to talk more about insurance resources, you can join our free HealthTree Coach program here: https://healthtree.org/myeloma/coach/