There is a growing trend in the Medicare market for individuals to choose an advantage plan over a medigap supplemental plan when they first enroll in Medicare. It is a personal choice and my clients that have an Advantage plan tend to love their plan and would not want to leave it to join to a Medicare supplemental plan, at least not be healthy ones.
Regardless of the information I will tell you, many will still choose an Advantage plan over a Medigap plan. But knowledge is power, and I think everyone should be aware of a significant difference in how and when you can enroll in or change these plans.
I’m afraid something important is being overlooked in all the hype stirred up by those long TV commercials regarding Medicare Advantage plans. You may be giving up your only one-time chance to join a Medicare Supplemental Plan without having to go through medical underwriting.
Before you give up that opportunity, I think it is important for you to look at the differences of the two types of plans and make an educated choice. If you remain healthy in the years to come you could apply for, and possibly join, a Medicare supplemental gap plan later by passing through medical underwriting, but that may not be the case.
One of the things that is often overlooked when people are trying to decide between buying a Medicare supplemental plan, also called a Medigap plan, and a Medicare Advantage plan, is the guaranteed issue period that you are offered on a Medicare supplemental plan when you first get on Medicare Part B.
Joining a Medicare Advantage plan is simple.
- There are no medical questions asked and therefore there is no medical underwriting. This is the case when you first get on Medicare.
- This is also the case at any Medicare Annual Enrollment period. If you would like to change your plan For the upcoming year you can do that with a simple application and there would be no medical questions asked.
Unlike a Medicare Advantage plan, Medicare Supplemental Gap plans require the Medicare beneficiary to undergo medical underwriting when they apply for a medigap plan except under special situations.
Most people that call me about Medicare choices do not realize that you would have to answer health questions and go through the process of medical underwriting, and be approved to join a Medicare Supplement Gap plan unless you have another guaranteed issue qualifying event Like moving to a different state.
Did you know that when you first Sign up for your Medicare Part B (the part you buy from Social Security that you have to pay for) you are given an Open Enrollment Guaranteed Issue situation enabling you to join a Medicare Medigap Supplemental plan without having to answer health questions and go through any underwriting process?
During that time, you cannot be turned down for A Medicare supplemental gap plan any reason by the carrier of your choice. Nor can your premium be raised above the standard cost due to past or present health conditions. This starts the month you turn 65 (or leave an employer’s plan and join Medicare Part B for the 1st time) and continues for six months.
Many people forfeit that guaranteed issue opportunity when they go straight to a Medicare Advantage plan instead of trying a Medicare supplemental plan first.
Most Medicare beneficiaries will never again experience a Guaranteed Issue opportunity allowing them to join a Medicare medigap plan with such ease and with guaranteed acceptance as when they enroll in Medicare Part B for the first time.
Below are some of the main differences between Medigap (Medicare Supplement) Plans and Medicare Advantage Plans
Medicare Supplement (Medigap)
- Open Enrollment Guaranteed Issue easy enrollment without medical underwriting but later would require answering medical questions to join or change plans
- Use any provider and the large nationwide Medicare Network
- Premiums typically around $125 monthly
- Very low Out of Pocket cost on most Medigap plans
- No deductibles on most plans
- Picks up some or all cost leftover by Medicare
- Never includes prescription drug coverage, so a stand-alone drug plan needs to be purchased separately
- Typically, only covers services that Medicare covers
Medicare Advantage
- Never any medical underwriting to join or change plans
- Smaller Plan Network
- Premiums typically between $0-$59 monthly
- Possible Out of Pocket cost typically $6700
- No deductible on most plans
- Copays for most services
- Often includes prescription drug coverage at no additional premium. These costs are in addition to the plan out of pocket maximum
- Often offers additional benefits beyond what Medicare covers like Dental, Vision, Hearing, Meals, Transportation, Free over the counter drugstore items, etc.