Medicare Advantage plans have been growing in popularity in recent years and have been outpacing Medigap (Medicare Supplement) plans. In 2022, there were more than 30 million seniors enrolled in Medicare Advantage plans and roughly 14 million enrolled in Medicare Supplement plans. One reason for the growth in Medicare Advantage enrollment is that these plans often offer benefits beyond what is covered by traditional Medicare, such as vision, dental, and hearing coverage, as well as prescription drug coverage. Medicare Supplement is designed only to help pay for some of the out-of-pocket costs that Medicare doesn’t cover, such as deductibles, copayments, and coinsurance.

While the popularity of Medicare Advantage continues to increase, there are still several reasons why some seniors find Medicare Supplement to be a more appealing option.

How Medicare Supplement and Medicare Advantage help bridge the gaps

While Medicare covers many healthcare services, it doesn’t cover everything and there are significant cost-sharing structures in place. That’s where Medicare Supplement and Medicare Advantage come in. Both options provide additional coverage to help fill the gaps in Medicare coverage. However, there are some key differences between the two. Medicare Supplement, also known as Medigap, is a type of insurance policy that is sold by private insurance companies. It is designed to help pay for some of the out-of-pocket costs that Medicare doesn’t cover, such as deductibles, copayments, and coinsurance. Medicare Advantage, on the other hand, is a type of health insurance plan that is also offered by private insurance companies. It provides all the benefits of Medicare Parts A and B, as well as additional benefits such as prescription drug coverage, dental, vision, and hearing benefits.

The benefits of Medicare Supplement insurance

1. More flexibility

Medicare Supplement plans allow you to see any doctor or specialist who accepts Medicare, without needing a referral. This means you have more freedom to choose the healthcare providers that are right for you. With Medicare Advantage, you are typically required to choose a primary care physician and get referrals to see specialists.

2. More predictable costs

The most chosen Medicare Supplement coverage, Plan G, covers all out-of-pocket cost sharing except the Part B deductible. This means that the member’s out-of-pocket costs are more predictable when they go to the doctor or hospital. Medicare Advantage cost sharing varies greatly by plan, although cost sharing levels are required to be equivalent or less than original Medicare.

3. Easier comparison of plans

Medicare Supplement plans have standardized benefits, which means that the coverage and costs are the same no matter which insurance company you choose. This makes it easier to compare plans and understand what you’re getting. With Medicare Advantage, the benefits and costs can vary widely depending on the plan you choose and the insurance company offering it. This can be overwhelming for seniors, as they weigh the pros and cons of a myriad of options.

4. No network restrictions

With Medicare Supplement, you can see any doctor or specialist who accepts Medicare, regardless of whether they are in-network or out-of-network. With Medicare Advantage, you are typically required to stay within a network of providers, which can be limiting if you need to see a specialist who is not in-network.

Ultimately, the decision between Medicare Supplement and Medicare Advantage will depend on your individual healthcare needs and preferences.