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Wondering how to choose the best Medicare plan for you? It can be a big decision, and it's not one to be taken lightly. Medicare only covers about 80% of your healthcare costs. You will be responsible for the other 20% as well as deductibles and copays.
Though both policies help you cover your gaps in Medicare, they are designed very differently.
Medicare supplements pay as a secondary insurance to Medicare. This means they pay after your Medicare first pays its portion of the bill. You stay enrolled in Medicare, and Medicare sends the remainder of your bills to your Medicare supplement company.
Medicare Advantage plans, on the other hand, are entirely separate from Medicare. When you enroll into a Medicare Advantage plan, you get your benefits from the plan, not Medicare. You agree to use the plan’s network of providers except in emergencies. You’ll pay copays for your health care treatment as you go along. Think of these plans as an alternative to Original Medicare.
Let’s explore a bit more about each type of plan.
Medicare supplement plans are also called Medigap. Having a Medigap plan means you are still enrolled in Original Medicare as your primary insurance. You can see any provider that participates in Medicare, regardless of which supplement company you chose.
You have access to all the Medicare providers nationwide – no referrals necessary. If you enroll in a comprehensive plan like Plan F or Plan G, you will have very little out of pocket. Not even doctor copays!
When you enroll, your Medicare supplement insurance company notifies Medicare that you have enrolled. Thereafter, when Medicare pays its portion of your bills, it will automatically send the remainder of your bill to your Medicare supplement company. It’s seamless, with no claims forms for you to file.
Medicare supplements also offer you the most freedom. You have freedom to choose your own doctors and hospitals from among the 800,000+ Medicare providers in the nation. No referrals are necessary to see a specialist.
Because these plans offer you the most freedom and flexibility, they have higher premiums than Medicare Advantage plans. It depends on which Medigap plan is chosen and whether that individual uses tobacco. Plans and rates vary by region, age and sometimes gender.
Medigap plans cover medications administered in a hospital setting, such as injectables or chemotherapy drugs. They do not cover retail medications though, so most beneficiaries will enroll in a separate Part D drug card.
If you enroll into a Medigap plan during your one-time open enrollment window (within 6 months of your Part B effective date), there are no health questions. The insurance company will approve your application. There are no waiting periods or pre-existing condition exclusions. If you miss this window and apply later on, then you must answer medical questions and be underwritten.
About 30% of beneficiaries choose Medicare Advantage plans, which are private insurance plans. They usually have lower premiums than Medigap plans. Sometimes even a $0 premium on some plans in some areas. No additional premium after you pay your Part B premiums monthly. Why? Because you agree to use the plan’s network providers to get your care. This means you’ll have substantially fewer doctors to choose from than if you chose a Medigap plan.
It’s important to check with your doctors first to see if they are in the network. This is especially important if the Advantage plan you are considering is an HMO, which often have the smallest networks.
Your Medicare Advantage plan will pay your healthcare bills instead of Medicare paying them. You will pay copays for the services you obtain from providers in the plan’s network as you go along.
You must be enrolled in both Part A and Part B and continue to pay your Part B premiums to be eligible for a Medicare Advantage plan. There is also one health question about End Stage Renal Disease (ESRD). People with ESRD do not qualify for Medicare Advantage plans.
Boomer Benefits provides free claims support for life for all of our Medigap and Medicare Advantage policyholders so that you are never alone in dealing with Medicare.
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