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Is Original Medicare with a Medigap or Medicare Supplement More Expensive Than a Medicare Advantage?

Original Medicare with a Medigap or Medicare Supplement More Expensive Than a Medicare Advantage

Medicare-eligible individuals face an important decision when signing up for coverage – whether to stick with Original Medicare plus a Supplement (Medigap) policy or switch to an all-in-one Medicare Advantage Plan. Cost is often a major factor in this decision. Let’s look at how the costs compare between these two options.

What is Medigap and How Does it Work?

Medigap policies are sold by private insurance companies to fill coverage gaps in Original Medicare. Medigap covers cost-sharing amounts like deductibles, copayments and coinsurance that you would otherwise pay out of pocket under Parts A and B. These policies allow you to see any healthcare provider nationwide that accepts Medicare.

Understanding the Basics of Medigap

  • Medigap is supplemental coverage for Original Medicare only
  • It helps pay for deductibles, copays, and coinsurance in Parts A and B
  • Standardized plans exist, labeled with letters like Plan G and Plan N
  • You can see any doctor or hospital accepting Medicare nationwide

Benefits of Medigap vs. Medicare Advantage

Medigap advantages include lower out-of-pocket costs and nationwide provider access. Disadvantages are no extra benefits and potentially higher premiums.

Comparing Costs of Medigap and Medicare Advantage

Medigap premiums are generally higher, while Medicare Advantage can have $0 premiums but includes copays for services. Overall costs depend on your healthcare utilization.

Enrolling in a Medigap Plan

The best time to enroll is within 6 months of turning 65 and enrolling in Medicare Part B. This guarantees you access to a plan regardless of health conditions.

Choosing Between Medigap and Medicare Advantage

Weigh factors like budget, health needs, doctors, medications, and desire for nationwide access vs. extra benefits when choosing between the two options.

Understanding Medicare Advantage Plans

Medicare Advantage Plans are an alternative to Original Medicare offered through private insurers. Let’s look at some key facts:

How Medicare Advantage Differs from Original Medicare

These plans include all Part A and Part B coverage but deliver it through provider networks like HMOs and PPOs. Many have $0 premiums but copays for services.

Coverage and Costs of Medicare Advantage

Plans cover all Medicare Part A and B services. Many also include Part D drug coverage. Maximum out-of-pocket caps limit spending. Some offer extra benefits like dental or vision.

Benefits of Medicare Advantage vs. Medigap

Medicare Advantage advantages include lower premiums, extra benefits like dental coverage and annual out-of-pocket caps. The tradeoff is provider networks.

Enrolling in a Medicare Advantage Plan

You can enroll when first eligible for Medicare and also during the annual open enrollment period from October 15 to December 7 each year for January 1 coverage.

Choosing Between Medicare Advantage and Medicare Supplement insurance

Look at your budget, health, providers, medications, and interest in extra benefits like dental and fitness programs when comparing the two options.

Medicare Part B and Prescription Drug Coverage

Whether you choose Medigap or Medicare Advantage, you need to factor in Part B and Part D drug coverage:

Eligibility and Enrollment for Medicare Part B

You must be enrolled in Medicare Part B to purchase a Medigap policy. Part B has a standard premium of $164.90 per month for most enrollees in 2023. Higher earners pay more based on tax returns.

Understanding Medicare Part D Prescription Drug Coverage

Part D provides prescription drug coverage through private plans with premiums and cost sharing. It can be purchased standalone or included in a Medicare Advantage Plan.

How Medigap and Medicare Advantage Plans Offer Prescription Drug Coverage

Most Medicare Advantage Plans include Part D coverage. With Medigap, you need to enroll in a separate Part D Plan since Medigap policies do not cover prescriptions.

Comparing Medicare Part D Coverage Costs

Look at each plan’s premiums, deductibles, copays and coinsurance. Medicare Advantage with integrated Part D may cost less overall compared to Medigap plus a standalone Part D Plan.

Choosing the Best Medicare Plan for Prescription Drug Coverage

Review each plan’s formulary and costs for your specific prescriptions. Ensure the plan meets your medication needs and budget.

Difference between Medicare Advantage and Medigap

Understanding the Costs of Original Medicare and Medigap

With Original Medicare, you’ll pay a $226 Part B deductible in 2023 then 20% coinsurance. Medigap covers most coinsurance so out-of-pocket costs are lower but premiums like Plan G at $1500 per year are higher.

Comparing Out-of-Pocket Expenses for Medicare Advantage and Medigap

Medicare Advantage Plans have copays up to a yearly out-of-pocket maximum around $5000 on average. Medigap covers nearly all coinsurance amounts so expenses beyond premiums are lower.

Factors Affecting the Costs of Medigap and Medicare Advantage Plans

Where you live, plan availability, age, tobacco use and other factors impact Medigap and Medicare Advantage Plan premium costs. Shop around for competitive pricing.

Assessing Potential Savings with Medigap vs. Medicare Advantage

If you have extensive healthcare needs and high utilization, Medigap may offer savings by limiting coinsurance. For healthy people, Medicare Advantage can cost less.

Guidance on Choosing the Most Cost-Effective Option for Your Healthcare Needs

Look at your health, medications and total expected healthcare usage. Compare premiums plus all out-of-pocket costs between Medigap or Medicare Advantage to determine the most affordable option.

Factors to Consider When Choosing Between Medigap and Medicare Advantage

Key decision points include:

Differences in Coverage and Specialized Care

Medicare Advantage may require referrals for specialists. Medigap allows you to see any Medicare provider nationwide without constraints.

Healthcare Provider Access and Network Considerations

Medigap covers any provider accepting Medicare. Medicare Advantage features local provider networks. Ensure your doctors participate.

Medication and Prescription Drug Needs

If you take expensive drugs, Medigap plus Part D can offer more coverage and formulary options versus limited Medicare Advantage drug formularies.

Potential Financial Impact and Budgetary Considerations

Weigh premium costs against total out-of-pocket spending. High utilizers may get more value from Medigap’s lower coinsurance costs.

Long-Term Healthcare Planning and Future Healthcare Needs

Think about your long-term needs when choosing plans. Medigap ensures continuous coverage as your health changes. Medicare Advantage enrollment is time-restricted.

Choosing between Medicare Advantage or Medigap involves tradeoffs between costs, coverage, flexibility, providers, and more. Evaluate all these aspects carefully based on your situation to feel confident you are making the optimal Medicare Plan decision.

We’re Here to Help

You do not have to spend hours reading articles on the internet to get answers to your Medicare questions. Give the licensed insurance agents at Think65 a Call at (719) 301-1220. You will get the answers you seek in a matter of minutes, with no pressure and no sales pitch. We are truly here to help.


Is Medicare with a Medigap supplement more expensive than a Medicare Advantage?

 The cost of Medicare with a Medigap supplement versus a Medicare Advantage Plan can vary depending on various factors such as the specific plans available in your area, your healthcare needs, and your budget.

What is a Medicare Supplement Plan?

 A Medicare Supplement Plan, also known as Medigap, is a health insurance policy sold by private insurance companies to fill the “gaps” in Original Medicare coverage, such as copayments, coinsurance, and deductibles.

What is traditional Medicare?

 Traditional Medicare refers to Original Medicare, which includes Medicare Part A (hospital insurance) and Medicare Part B (medical insurance) provided by the federal government.

How do I choose between Medicare Advantage and Medicare Supplement?

 When deciding between Medicare Advantage and Medicare Supplement Plans, consider factors such as your healthcare needs, budget, the flexibility of providers, coverage options, and whether you prefer a network-based plan (Medicare Advantage) or freedom to choose providers (Medicare Supplement).

What does Medicare Advantage or Medicare Supplement cover?

 Medicare Advantage Plans provide coverage for Medicare Part A and Part B services, typically including additional benefits such as prescription drug coverage (Part D), while Medicare Supplement Plans help with out-of-pocket costs not covered by Original Medicare.

Can I buy a Medigap policy if I have Medicare Advantage?

 In most cases, you cannot buy a Medigap policy if you are enrolled in a Medicare Advantage Plan, unless you’re switching back to Original Medicare.

Are prescription drug plans also included in Medicare Advantage or Medicare Supplement Plans?

 Many Medicare Advantage Plans include prescription drug coverage (Part D), while Medicare Supplement Plans do not include Part D coverage and would require a separate Part D Plan.

What are the differences between Medicare Part A and Part B?

 Medicare Part A (hospital insurance) primarily covers inpatient hospital stays, skilled nursing facility care, hospice care, and some home health care, whereas Medicare Part B (medical insurance) covers doctor visits, outpatient care, preventive services, and some medical equipment.

Can I return to Original Medicare if I choose Medicare Advantage?

 Yes, you have the option to return to Original Medicare if you choose to leave your Medicare Advantage Plan during certain enrollment periods or special circumstances.

What is the state health insurance assistance program?

 The State Health Insurance Assistance Program (SHIP) is a national program that offers personalized counseling and assistance to people with Medicare, empowering them to make informed healthcare choices and navigate the complex Medicare system.

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