Medicare Supplement vs. Medicare Advantage: What’s the Difference?

Applying for Medicare once you reach retirement age sounds simple enough. But just because you’re covered under the federal health insurance program doesn’t mean you won’t be faced with out-of-pocket costs.

Health-related expenses like hospital care, doctor visits, medical procedures and equipment are covered by Original Medicare (Parts A and B). Like a traditional health insurance policy, Medicare pays its share of the Medicare-approved amount, and you’re responsible for a portion. That typically includes out-of-pocket expenses such as deductibles, copayments and coinsurance.

But for many seniors – especially those on a fixed income – the risk of having unforeseen health care costs in retirement can be stressful. Luckily, you have options available to help set your mind at ease.

In today’s insurance market, there are two primary choices to help protect Medicare recipients against out-of-pocket medical expenses: Medicare Supplement insurance and Medicare Advantage plans. But how do you decide which plan is right for you?

Here’s a quick guide to help you understand the difference:

What’s a Medicare Supplement Plan?

Sometimes called “Medigap,” a Medicare Supplement plan is a private insurance policy that helps you pay for what Medicare doesn’t cover. You can apply for a policy when you sign up during your open enrollment period for Medicare Parts A and B. Available plans will vary depending on the state you live in and carrier you purchase through.

In addition to helping you cover unexpected expenses, Medicare Supplement plans offer some additional benefits, including the ability to choose any doctor or hospital that accepts Original Medicare.

What’s a Medicare Advantage Plan?

A Medicare Advantage plan, sometimes called “Part C,” is another option to help cover medical costs for seniors. But unlike Medigap plans, which functions like an insurance policy in addition to Medicare, Medicare Advantage plans are more like a private form of health insurance you buy in place of Medicare. In most cases, these plans cover everything provided by Medicare Parts A, B, and D, while offering some additional services.

Medicare Advantage plans are offered by a range of private companies, including:

• Health maintenance organizations
• Preferred provider organizations
• Private fee-for-service plans
• Special needs plans
• Medicare medical savings account plans

It’s important to note that while Medicare Advantage plans generally have lower premiums, they still have out-of-pocket costs like copayments and deductibles. And because they’re like a health insurance plan, you could potentially be tied to a certain provider network and need referrals to see a specialist.

Let ERIE Help You Choose

We understand reviewing and choosing options for Medicare coverage can be daunting. But you don’t need to be an expert because we’re here to help. Contact your Erie Insurance agent or find an agent in your neighborhood.

Erie Family Life Insurance Company and our agents can help you determine the best option for you and your family. We offer a range of Medicare Supplement plans to fit your life and budget. Best of all, we’ll always be here when you need us, ready to answer your questions. That’s our promise of service.

Home Office: 100 Erie Insurance Place, Erie, PA 16530; toll-free at 1-800-458-0811. ERIE® life and health insurance products and services are provided by Erie Family Life Insurance Company. Information regarding additional terms, conditions, exclusions, licensure and territory information is available at erieinsurance.com/medicare-supplement. Eligibility for insurance coverage will be determined at the time of application, based upon applicable underwriting guidelines and rules in effect at that time. In some states, Medicare Supplement policies are available to disabled individuals under the age of 65. Not all plans are available in all states. ERIE Medicare Supplement insurance is not available in the District of Columbia and New York. This is a solicitation of insurance. An agent (or the company) may contact you. Erie Family Life does not sell Medicare Advantage plans.

Ohio: You may verify that the agent is licensed by contacting The Ohio Department of Insurance, 50 West Town St., Suite 300, Columbus, OH 43215, toll-free at 1-800-686-1526

Tennessee: Medicare Supplement policy forms for Tennessee: EFLMS3003 9/17 (A) TN; EFLMS3009 9/17 (F) TN; EFLMS3014 9/17 (G) TN; EFLMS3019 9/17 (N) TN.

Maryland: Medicare Supplement policies are available to disabled individuals under the age of 65.

Not connected with or endorsed by the U.S. Government or the Federal Medicare program.