While Medicare will provide some coverage for your medical bills, it was never intended to pay for all of your expenses. A hospital stay, prolonged outpatient treatment, or expensive monthly prescription could be financially devastating if you are relying on Medicare alone. Fortunately, there are some options. Medicare supplements, Medicare Part D coverage, and Medicare Advantage Prescription Drug plans can all help limit your exposure to big out-of-pocket expenses.

What is a Medicare Supplement?

A Medicare supplement, also known as a Medigap plan, fills in some of the gaps in your Medicare hospital (Part A) and medical (Part B) coverage. When you receive Medicare-covered services, Medicare pays first, then the supplement pays some or all of the remaining costs. The nice thing about a supplement is that there are no network restrictions – you can go to any doctor or hospital that accepts Medicare, and no referrals are required.

There are ten standardized Medicare supplement plans, which means that a Plan F from one insurance company, for instance, will cover the same expenses as a Plan F from another insurance company. When you first sign up for Medicare Part B, regardless of age, you have 6 months to purchase a Medicare supplement without answering any medical questions; after that, any application or changes you want to make may require medical approval.

Read more about Medicare supplement plans.

What is Medicare Part D?

Medicare Parts A and B, also known as Original Medicare, don’t provide coverage for most prescription drugs. To get help with the cost of your medications, you’ll need to purchase a Medicare Part D prescription drug plan.

Part D drug coverage can be purchased as a stand-alone plan to accompany Medicare + a supplement or can be incorporated into a Medicare Advantage plan. Either way, there are a lot of options. And while there are a number of similarities between many of the drug plans offered, there are also some factors to consider when deciding which plan is best for you, including the plan’s drug formulary, the monthly premium, the copayments and/or coinsurance you’re required to pay at the pharmacy, and the reputation of the insurance company.

Unlike a Medicare supplement plan, you can change Part D plans annually during the Annual Election Period (AEP) without having to qualify for the coverage.

Read more about Medicare Part D plans.

What is a Medicare Advantage plan?

Medicare Advantage plans are health plans offered by private insurance companies that contract with Medicare to provide Part A hospital and Part B medical benefits to people with Medicare who enroll in the plan. Many of these plans also provide Medicare Part D coverage and are known as Medicare Advantage Prescription Drug (MAPD) plans. Medicare Advantage plans must cover all of the services covered by Original Medicare and may offer additional services, like vision, dental, or hearing coverage.

In contrast with Medicare plus a supplement, Medicare Advantage plans look more like the health plans people may have had through their employer or purchased in the individual market. They typically have set-dollar copayments for services like doctor visits and may have an annual deductible for higher-cost services like hospital visits or outpatient surgery. They also may require members to obtain services from contracted network providers and obtain a referral from their primary care physician to see a specialist.

For Medicare beneficiaries whose doctors participate in the provider network, Medicare Advantage plans can offer better coverage than Medicare alone and a cost-effective alternative to a Medicare supplement.

Read more about Medicare Advantage plans.

JME can help!

The experienced agents at JME Insurance Agency can help you navigate the multitude of insurance plans available to determine which Medicare Supplement or Medicare Advantage plan is best for you.