Which is better Medigap or Medicare Advantage? – is the question that causes dilemma to most of our older adults who just turned or will soon turn 65. If you are new to the Medicare program, you have to weigh the benefits of Medicare Advantage vs. Medigap and decide which one you will get to cover your health needs.

I understand that you want to get the best coverage for yourself, and choosing which is better between the two might confuse you. So, let me help you with this post.

Medicare landscape

Medicare has four basic parts:
Part A - hospitalization or inpatient coverage
Part B - Outpatient coverage
Part C - Medicare Advantage plans
Part D - Prescription drug coverage

It is important to know what each part DOES NOT cover, such as deductible, copays etc. It is important because you will have to find a way to cover those gaps so you won't shoulder heavy healthcare expenses in a time when you become seriously ill.
These are the out-of-pocket costs that you might shoulder if you go with Original Medicare only:

What is Medigap?

Choosing which of the two is best is not be possible if you do not know what each option are for. So, we have to start about Medigap definition and its purpose and how it works.

Medigap or Medicare supplement plans are additional health insurance sold by private insurance companies. It works with Original Medicare by minimizing the out-of-pocket costs left by the health program.

How does it work?
After Medicare has paid its share, Medigap will pay the Medicare-approved amount of healthcare expenses left.
Depending on the type, it can cover all or part of the out-of-pocket expenses including deductibles, copayment or coinsurance.

Since Medicare Supplement Plan F is going away in 2020, let’s just take a look at the next popular option which is Medigap plan G.

Let say you are facing a bad health year and requires a lot of medical attention. If you suffer a stroke or requires cardiac surgery, you may be looking at burdensome healthcare expenses. Here’s what you will pay out-pocket if you have Medicare supplement plan G:

On the other hand, Medigap doesn’t cover long term care, vision care, dental care, hearing aids, and private duty nurses.

What is a Medicare Advantage plan?

Medicare Advantage Plan is also called a Medicare Part C. Like Medigap, it is also provided by private insurance companies approved by Medicare. Through Medicare Advantage plan, you can receive the coverage of all the other three parts of Medicare (Part A, Part B, and Part D). In addition, other plans may offer extra coverage, like vision, hearing, dental, and/or health and wellness programs.

Most plans, cover services (after a co-pay) like office visits, lab works, surgery and more. Medicare Advantage plan can be HMO or PPO network plans, depending on what is available in your area.

Different plans of Medicare Advantage provide different benefits as well as rules. Most offer prescription coverage, some may require you to see a specialist while others don't. Some plans may pay a portion of out-of-network care that you obtain, while others will only cover the services within the HMO or PPO network.

So, which is better Medigap or Medicare Advantage?

To know which of the two options is best for you depends on a lot of factors. But you have to know that you can't have both at the same time. It is also illegal to sell you both plans.

To help you decide which one is best for you, consider the following factors:

Preferences:
Medicare Advantage plans have networks of doctors and facilities that you should only use to be covered.
In Medicare supplement plan, there is no network of doctors or facilities. you will be covered if you go to any doctors or facilities that accept Medicare.

So, if you have preferences in doctors or facilities check if those are covered by the option.

Cost:
Medicare Advantage premiums generally cost less and provide more benefits. There are even plans offered at $0 premiums.
Medigap on the other hand can be expensive compared to the latter. But it can minimize your health care out-of-pocket costs significantly.

Lifestyle:
Medicare Advantage plans usually cover only in certain locations or regions. If you are someone who frequently travels, Medigap may be a better choice. Some Medigap plans offer foreign health emergency coverage and can travel with you across the US or even outside the country.

Final words:

Choosing which option is best for you can be confusing. You may have to seek the assistance of a Medicare expert to guide you in decision making.