Training 8: Choosing a Medicare Plan – Medigap vs Medicare Advantage
Top things to consider when choosing between Medicare Advantage and Medigap
There are a couple things related to eligibility that may be beyond your control.
You may not be able to buy a Medicare supplement in some States if you are under 65 even if you are Medicare-eligible. Individual States govern insurance law and some States do not require insurance companies to offer Medicare supplements to people under 65.
If you find your self in this situation, you can either insure through original Medicare plus a stand-alone Part D plan or enroll in a Medicare Advantage plan if you qualify.
If you are not in your Medigap Open enrollment Period or do not qualify for Guaranteed Issue Rights, you will usually be subject to medical underwriting. Although most companies have fairly liberal guidelines, there are still times when a preexisting condition will stop you from buying a supplement.
The amount of money you can budget towards premiums will be an over-riding factor.
Many people with lower budgets will gravitate towards a Medicare Advantage plan because:
- Medicare supplement premiums are generally much higher than Medicare Advantage premiums
- If you buy a supplement, you will also need to enroll in Part D and will pay a separate premium
Medicare Advantage plans generally offer some benefits not included as part of original Medicare. Some companies offering supplements will also include some extras, but those benefits are normally not as numerous or benefit rich.
If you desire extras like dental, vision, hearing, gym memberships and transportation you may need to enroll in a Medicare Advantage plan.
Your General Philosophy
If utilizing a provider network seems to limit your freedom or doesn’t work well with your life style, you may want to consider a Medicare supplement if your budget allows.
Additionally, if the idea of having to navigate an annual enrollment period seems like a hassle you may also want to consider a supplement.
Medicare Advantage plans are available County by County and is some less populated Counties you may have very few plans to choose from and often times those plans will predominately be Private Fee-for-Service plans.
You may by default need to consider a Medicare supplement if your choice of Advantage plans is limited.
Part D plans all include a Formulary which is the list of drugs covered by a specific plan. There are two types of Part D Formularies: Basic and Enhanced.
A Basic Formulary will normally include the most popular drugs prescribed to Medicare beneficiaries. An Enhanced Formulary will often include the less common (read more expensive!) drugs as well.
Most Medicare Advantage plans with drug coverage include a Basic Formulary and if you drugs are not covered by the plans Formulary, it may become necessary to buy a supplement and enroll in a stand-alone Part D plan with an Enhanced Formulary.