MEDICARE SUPPLEMENT vs. MEDICARE ADVANTAGE

Medicare Advantage is Part C of Medicare and is an alternative approach to covering Parts A & B of Medicare.  With an Advantage plan, Medicare pays a private insurance company to administer all claims for that Medicare beneficiary.  The insured does not use the red, white, and blue Medicare card for claims but the insurance card of the private company.

Because there is no supplemental insurance policy specifically designed for Medicare Advantage plans, the insured will still have gaps (deductibles, co-payments, and/or coinsurance amounts) to pay for office visits and hospital stays.

The advantages of an Advantage plan are two:

1.      Usually a low monthly premium, and

2.      No health questions asked.

The disadvantages, however, can be numerous, including:

1.      The benefits AND the premium can and usually do change every January 1,

2.      Fewer doctors and hospitals accept these plans,

3.      Advantage plans may not cover some claims that Original Medicare would, and

4.      After the initial 12-month Trial Right period, a person with health problems may not be able to purchase the same Medicare Supplement policy traded in for the Advantage plan.

Original Medicare + a Plan F Medicare Supplement usually cover the Medicare-approved doctor and hospital charges in full, leaving the insured responsible only for the monthly premium.  As of June 1, 2010, at least one insurance company is offering the new, more affordable Plan N Medicare Supplement with no health questions.