Basic Medicare coverage, while robust in nature, leaves many “gaps” in the coverage and could potentially expose the Medicare recipient to large “cash out-of-pocket” costs.
Medicare Supplements, also known as Medigap policies, are designed to mitigate the risk of those large, “cash out-of-pocket costs and help by filling the “gaps” in coverage. Those “gaps” can include deductibles, coinsurance, and copays. In addition, Medicare Supplements provide coverage for foreign travel, original Medicare does not.
Medicare supplement plans and Medicare Advantage plans are often confused, but they are two different types of coverage and cannot be sold together. Medicare Supplement plans only work with original Medicare and are offered by private insurance companies.
Medicare Advantage plans, also known as Medicare Part C, are an alternative plan option to Original Medicare and Medicare Supplements; however, Medicare recipients covered by these plans are still required to carry original Medicare Part A and B.
Much of the attraction for these plans comes from the low premiums, starting as low as $0 per month. These plans are built on a “pay as you go” system of copays, deductibles, and max-out-of-pockets, and require you to use a designated network of doctors, specialists, and hospitals. Unlike Medicare Supplements, these plans include prescription drug coverage, dental plans, vision coverage, a fitness plan, meals, and over-the-counter benefits.
Medicare Part D
This optional coverage may help lower an individual’s prescription drug costs and help protect against higher costs in the future. Medicare Part D is simply insurance for consumer’s medication needs. Beneficiaries can choose to enroll in either a stand-alone prescription drug plan (PDP) to supplement traditional Medicare or a Medicare Advantage prescription drug plan (MA-PD). Part D is optional, but people who wish to avoid a penalty will need to consider having creditable prescription drug coverage.
Disclaimer: Currently, we represent three organizations that offer 15 products in your area. You can always contact Medicare.gov, 1-800-MEDICARE, or your local State Health Insurance Program for help with plan choices.