Questions and Answers: Medicare Advantage vs. Medicare Supplement
For many seniors, finding the Medicare plan with the right benefits and coverage options can feel like solving a mystery. Medicare beneficiaries generally choose Original Medicare, Medicare Advantage (which will provide you benefits equal to Medicare Parts A and B), or Original Medicare with a Medicare supplement (Medigap) plan to cover the portion Medicare doesn't. A person can't have Medicare Advantage and Original Medicare, with or without a Medigap plan, so it's an important decision to make when turning 65.
Request your Medicare comparison guide today
What’s the difference between a Medicare supplement (Medigap)
and Medicare Advantage?
| Medicare supplement insurance plans | Medicare Advantage plans | |
|---|---|---|
Doctors |
You can select your doctors and hospitals as long as they accept Medicare patients. | You may be required to use doctors and hospitals in the plan network. |
 Referrals |
You can see specialists without referrals. | You may need referrals and may be required to use specialists in your network. |
Networks |
No network restrictions. Coverage goes with you across the United States. | You may have network restrictions. Energency care is covered for travel within the United States and sometimes abroad. |
Enrolling |
You can apply to buy a Medicare supplement insurance plan any time after you turn 65 and join Medicare Part B. | Generally, there are specific periods during the year when you can enroll or switch to another Medicare Advantage plan. |
Costs |
You pay a monthly plan premium in addition to your Part B premium. When you use services, your out-of-pocket costs are limited. | Generally, you pay a low or $0 monthly plan premium in addition to your Medicare Part B premium. However, when you use services, you pay co-pays, co-insurance and deductibles. |
 Prescription drug coverage |
Prescription drug coverage is not included. Consider also purchasing a Medicare Part D plan. | Prescription drug coverage can be included on some plans. |
Big health insurance questions with possibly different answers
Navigating through the options offered by traditional Medicare benefits with supplemental insurance or Medicare Advantage plans brings retirees face to face with familiar questions, such as:
- Will I choose my health care provider from a network?
- Can I stay with my current doctor?
- How will my prescriptions be covered?
- Will I pay less in premiums, but more per visit?
- If I pay a larger premium, can I stop worrying about per-visit charges?
- Will my coverage and benefits change on me in the future?
Medicare supplement insurance and Medicare Advantage plans have different answers to these questions. When weighing the advantages and disadvantages, two key factors are known medical concerns and needs, and expected income and resources going into retirement. A third consideration is your reasonable expected health care needs as you look to the future. Your family history, past employment, or an active lifestyle may require health services, such as knee replacements or other surgeries, down the road. But seniors should not let these choices stop them—those who delay enrollment may face long-term penalties.
Medicare Advantage plans offer low premiums with conditions
Seniors often choose Medicare Advantage plans for low- or zero-cost plan premiums. However, zero-dollar premiums don’t mean free. The following common instances still require payment by the Medicare beneficiary:
- Medicare Part B premium must still be paid to the federal government (2022 Medicare Part B premium is $170.10—up from $148.50 in 20211).
- Copayments/coinsurance/deductibles will still apply, depending on services received, and will vary by company.
- If a doctor is out-of-network, a Medicare Advantage policyholder may pay more for that visit than someone with a Medicare supplement insurance plan. With a Medicare Advantage plan, enrollees agree to certain plan conditions, such as the use of in-network doctors, referrals, and (possibly) regionally based care. Some travel coverage may be offered, including internationally, and prescription drug coverage is typically included. Other common managed-care wellness features may be included as well. However, plan changes and enrollment are limited to the Initial Enrollment Period when turning 65 or the Open Enrollment Period each year. If a Medicare Advantage carrier does not renew its contract with Medicare, customers can be left without a policy at the end of the policy year.
Medicare supplement insurance (Medigap) has flexibility and options
Original Medicare with supplemental insurance is available to enrollees as they become eligible for Medicare Part B, usually at age 65 or due to disability. Participants pay regular Medicare premiums plus a supplemental insurance premium, and they can visit any doctors or specialists who accept Medicare assignment. This combination of plans allows enrollees to limit their out-of-pocket costs, except for prescription drugs, which are not covered. Seniors can purchase a stand-alone Medicare Part D plan to add prescription coverage. Additional features ease the minds of seniors, such as allowing them to move out of state without needing to enroll in a new plan.
Also, seniors have guaranteed issue when signing up for Medicare supplement insurance during their Initial Enrollment Period, which means there are no medical underwriting questions to answer. If a beneficiary wants to enroll in a Medicare Advantage plan now and switch to a Medicare supplement insurance plan later, that person may have to answer some basic medical questions to be accepted—so it’s important that individuals select the right plan for their situation up front.
Pros and cons—determining the best plan
- Will I still be covered by Original Medicare? With a Medicare supplement plan, you keep your Original Medicare coverage and pay your Part B premium. With a Medicare Advantage plan, Original Medicare is replaced by coverage from a private company; you still need to pay your Part B premium.
- Can my plan be terminated? A Medicare supplement plan cannot terminate your coverage and is guaranteed renewable for life, as long as you pay your premium. Medicare Advantage plans can change benefits and networks, or even be discontinued, at the end of each year.
- Can my plan benefits be reduced by the insurer? As long as you continue to pay the Medicare supplement plan premium, benefits will only change if required by law. With a Medicare Advantage plan, copays, deductibles, and out-of-pocket limits can change each year.
- What service area does the plan cover? With a Medicare supplement plan there is no network, so you can see any health care provider that accepts Medicare in the U.S. With a Medicare Advantage plan, the plan network is usually limited to certain providers and geography, except in emergencies.
- Do I need referrals? No referrals are necessary with a Medicare supplement plan. With a Medicare Advantage plan, referrals can be required for specialists or to get care outside the network.
- Does the plan include supplemental benefits? Medicare supplement plans provide coverage in addition to your Original Medicare coverage. Medicare Advantage plans vary. They must have benefits at least equal to Original Medicare, but they are not required to provide supplemental benefits.
- What happens if I move out of state? The Medicare supplement (Medigap) plan moves with you wherever you live in the U.S. With a Medicare Advantage plan, moving out of the plan’s area can cause loss of coverage.
- Does the plan have to cover Wisconsin’s state-mandated benefits? Under a Medicare supplement plan, state-mandated benefits—such as skilled nursing care, home health care, and chiropractic care—are covered. With a Medicare Advantage plan, state-mandated benefits are not required to be covered.
Request your FREE Medicare supplement information kit!
Value-added services
It’s common for Medicare Advantage plans to include value-added services, such as hearing and fitness programs. It’s important for Medicare supplement insurance customers to look for these benefits as well, because they are becoming more common.
With WPS Health Insurance, the Medicare supplement insurance plan can include:
- A fitness center membership3
- A hearing program3
- A vision program3
- And more.
WPS also offers premium discounts, including a 7% household discount2 and a 2% discount for automatic premium withdrawal.
