Question: Which is best and why: to purchase a Medicare supplement or to enroll in a Medicare advantage plan?
Answer: From a financial perspective, there are some very good reasons to consider a Medicare Advantage plan (also called Medicare Part C). It is important to understand that, when you choose to be insured under a Medicare Advantage plan, you are effectively choosing a private insurance plan and “opting out” of Original Medicare while you are under that plan. A Medicare Advantage plan is a “blanket plan” that covers many of the benefits that would otherwise require you to purchase multiple components under Original Medicare, including Medicare Part A (Hospital Insurance), Medicare Part B (Medical Insurance), a separate Medicare Supplement plan (Medigap), and a separate Medicare Part D (Prescription Drug) Plan. There are both pros and cons when deciding to choose a Medicare Advantage plan versus keeping Original Medicare along with a Medicare Supplement.
On the “pro” side, perhaps the biggest reason that most seniors choose a Medicare Advantage is that they offer a savings in out of pocket costs for both medical care and prescription drugs, in exchange for your agreement to use their specific list of in-network providers. Some also provide additional benefits such as covering the monthly fee for health club membership. Medicare Advantage plans may charge an additional premium, typically in the range of $20 to $60 per month. Each plan also has unique co-pays for medical office visits and prescription drugs. Co-pays can vary significantly with each plan, so shop carefully, keeping in mind the types of physicians you normally see and the specific drugs you normally take.
On the “con” side, most Medicare Advantage plans are HMO type plans, where you do not have the choice to see any doctor that you wish. You must go to the doctors, hospitals, and other medical providers on the plan’s list. If you need to see a specialist, many require a referral from your Primary Care Physician in order to be seen by a specialist. This means that you must choose a Primary Care Physician that will be the Medicare Advantage plan’s “gatekeeper” to decide when your care merits a referral to a specialist. Some Medicare Advantage plans are PPO type plans, offering a wider selection of providers and greater ease when seeking a specialist.
Keep in mind that, when switching from one option to the other, there are specific windows that you must keep in mind. If you wish to change from Original Medicare to a Medicare Advantage plan, you must do so within the open enrollment period from October 15 through December 7, with changes taking effect the following January 1. If you wish to change from Medicare Advantage back to Original Medicare with a Supplement, you must do so within the period from January 1 through February 14.
When making a decision, the most important issue to consider is the type of medical care that you anticipate that you will need. If you have few medical issues, then a Medicare Advantage plan may serve you well and save you money. However, many Geriatric Care Managers suggest that, as seniors age and their medical needs become more complex, that they consider the greater flexibility offered by Original Medicare to choose the medical providers that will best meet their specific needs.
Marty Seigel, CSA
Advocare Elder Care Management
Delray Beach, Florida
Member of the national ElderCare Matters Alliance, Florida chapter
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