Each person’s health care needs are different, but some plans may be better suited for certain individuals. While Original Medicare, Part A and Part B, is government sponsored and accepted nationwide, Medicare Advantage (MA) Plans offer additional benefits—but at a cost. Medicare Supplement (MS) Plans add coverage for certain services in addition to original coverage.
But there’s more to it than that. First let’s explain the three major types of coverage options:
Part A and Part B
This is the traditional coverage provided by the federal government when you turn 65 or qualify due to disability or End-Stage Renal Disease (ESRD). It consists of two parts: A and B. Part A is cost free and pays for hospital services. Part B—which is optional—has a premium and pays for office visits, outpatient, and some other services.
It may be a good choice for you if:
- You can’t afford or don’t want to pay premiums. There are no premium costs for Part A. Part B premiums vary based on your income. In addition, you must meet deductibles ($1,288 for part A, $166 for part B) each year before Medicare kicks in. You’ll also have no out-of-pocket maximum to cap out your health care expenses.
- You travel frequently. Because it is a nationally accepted program, you have access to care throughout the United States. That means you’ll pay no additional cost for going “out of network” because there is only one network: providers who accept Medicare.
- You get coverage from an employer. If you’re still working and you get health care coverage from your employer, you may want to keep it. Purchasing an MA Plan, also called Part C, while still employed could result in you losing your employer-sponsored or retirement health coverage.
Part C Plans combine Part A and B into one product. Private insurers sell the coverage, and they may include premiums, deductibles, and copays that you’ll have to pay.
You may want to enroll in a plan if:
- You need prescription drugs. While you can purchase Part D Prescription Drug coverage along with Part A and Part B, most MA plans include coverage for medications. Part D premiums vary depending on your income, ranging from $10 to $100 per year.
- You want a cap on your out-of-pocket expenses. Like most health plans available from employers, these plans have out-of-pocket maximums. This represents the most that you’ll pay for your health care in a given plan year. Once you’ve met your out-of-pocket maximum, the plan pays for all covered services. Federal law keeps caps to no more than $6,700 per year.
- You want more coverage flexibility. Medicare comes with a standard 20 percent coinsurance for most services, which means each time you get care, it pays 80 percent of the bill. MA Plans may offer different coinsurance amounts, like 70/30, or copays—set dollar amounts—in exchange for different premium costs. They may also include additional coverage for dental, vision, and wellness services.
Check out even more Advantage details—like the difference between HMO and PPO coverage—and then search for plans that might be a good fit for your needs.
Like it says in the name, MS Plans—also called “Medigap”—are in addition to Part A and Part B. Rather than choosing a plan with a private insurer, you may want to purchase an MS Plan along with enrolling in Part A and B.
It is offered by private insurance companies in plan types designated A through N. The federal government sets the benefits for these plans, each with varying degrees of coverage. The only difference among insurance companies is price and reputation.
The main reason why you might choose this route is that you like Part A and Part B, but want additional coverage. You may be generally happy with the cost and access that come with traditional coverage, but want more. MS Plans cover services not covered such as dental, vision, hearing aids, and private or long-term care.
Find out more information about Medigap here, like the breakdown of services covered by plans A through N.
So how do you choose which one is right for you? Give one of our licensed experts a call today.
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