Medicare Supplement vs. Medicare Advantage: Pros and Cons
Key Takeaways
- Medicare Supplement (Medigap) plans help cover out-of-pocket costs from Original Medicare (Parts A and B) but don’t include extra benefits.
- Medigap plans are standardized across 10 categories and offer consistent coverage year to year, with some plans also covering foreign travel emergencies.
- Medicare Supplement plans typically has higher monthly premiums than Medicare Advantage, but it offers more predictable costs and freedom from provider networks.
- Medicare Advantage plans may suit those seeking lower premiums and bundled benefits, while Medigap is ideal for those who travel often, use frequent care, or want stable, supplemental coverage.
When it comes to comparing Medicare Supplement vs. Medicare Advantage pros and cons, there are many factors to consider – namely whether Original Medicare suits your needs or not. Medicare Supplement plans, also called Medigap plans, are private insurance plans that you can buy in addition to Original Medicare (Parts A and B).
Medigap doesn’t offer coverage for any additional benefits like vision or dental; instead, these plans help cover the out-of-pocket costs from Original Medicare. Some Medigap plans have coverage for foreign travel emergencies, making them a good choice for frequent travelers.
Medigap: Why You Should Care
Medicare coverage isn’t all the same, so understanding the options can help you choose coverage that works for your lifestyle. Knowing what is covered under Medicare Supplement vs Medicare Advantage is critical to making an informed choice that doesn’t leave you with regrets and quips about 20/20 hindsight.
In the case of Medigap, learning about this option before you turn 65 or soon after is important so you don’t miss an enrollment opportunity. You get a six-month Open Enrollment Period for Medigap that starts the first month that you have Medicare Part B and are 65. During that period, you can’t be denied based on pre-existing conditions. After the Medigap Open Enrollment Period, many Medigap plans require medical underwriting and may charge higher prices or not be available to you at all.
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How Medicare Supplement Works
Medicare Supplement plans are offered by private insurance carriers and fall into 10 categories that are set by the federal government. All the plans in a category have to provide the exact same coverage; the only difference is cost, such as premiums and deductibles. The categories are named with alphabetical letters: A-D, F, G, and K-N. Because of a rules change, Plans C and F are not available for people who turned 65 in 2020 or later.
For the most part, Medicare Supplement plans are not available to Medicare beneficiaries who are under 65. However, there are 33 states where at least one Medigap plan is available for those who are under 65.
Medigap Plans vs. Medicare Parts
Alphabetical letters are also used to label the different parts of Medicare, which are different from the different plans of Medigap.
Part A is Medicare hospital coverage and Part B is Medicare doctor coverage. Part C is a common label for Medicare Advantage plans and Part D refers to prescription drug plans.
We’ll do our best to differentiate between the “parts” and “plan” labels for you.
What Medicare Supplement Plans Cover
Covered by most Medigap plans:
- Part A coinsurance and hospital costs up to 365 extra days
- Part B coinsurance or copayment
- Blood (first three pints)
- Part A hospice coinsurance or copayment
- Skilled nursing facility coinsurance
- Part A deductible
Covered by a few Medigap plans:
- Part B deductible
- Part B excess charge
- Foreign travel emergency
- Out-of-pocket limit
Medicare Supplement Pros
Reduces out-of-pocket costs
Medicare Supplement plans are designed exclusively to reduce your out-of-pocket costs and they can be effective at doing that, especially if you know you need a lot of healthcare services. You can focus on the predictable cost of your monthly plan premium instead of getting hit with surprise healthcare bills throughout the year.
Covers out-of-country emergencies
A little over half of Medicare Supplement plans include coverage for foreign travel emergencies. If you’re a jet-setter or cruise aficionado, Medigap’s got you covered for travel illness, a fall, or other health emergencies. Most plans do have a limit on the amount that they cover for foreign emergencies, so pay attention to that.
Lifetime consistency
As a result of Medicare Supplement plans coverage being standardized, the amount of change in plans from year to year is relatively minimal. Unlike Medicare Advantage plans, where insurance providers can and do tweak benefits and costs every year, Medigap changes mostly consist of premium changes with no adjustment in the actual benefits. Your Medigap enrollment will roll over every year, barring company bankruptcy or other serious changes.
Medicare Supplement Cons
Requires underwriting
If you don’t get a guaranteed-issue Medigap plan during your Open Enrollment Period, pre-existing health conditions can be a major barrier to enrollment or lead to higher prices. Unlike Medicare Advantage plans and Original Medicare, Medigap plans can deny enrollment because of pre-existing conditions, so you’re only guaranteed a plan in that first 6-month enrollment period.
No additional services covered
Because Medicare Supplement plans only cover out-of-pocket costs related to Original Medicare, there’s no coverage for additional services like vision, dental, hearing, prescription drugs, fitness, or more. The cost of those other healthcare needs is an important factor in choosing your Medicare coverage.
Higher up-front costs
While 60% of beneficiaries enrolled in Medicare Advantage plans with $0 premiums in 2025, Medigap plans typically have higher premiums. For high deductible plans, low premiums are around $40-50, while the other plans are closer to $80 on the low end. With the enrollment barriers on Medigap, it’s often beneficial to calculate healthcare costs on a multi-year or lifetime basis rather than annually as one might with a Medicare Advantage plan.
Should You Get a Medicare Supplement Plan vs. Medicare Advantage?
Beyond the general pros and cons, how do you decide if Medicare Supplement plan is right for you, especially in comparison to Medicare Advantage? Choosing your health insurance is obviously personal and can be a nuanced situation based on your needs. A Medicare Supplement plan might be right for you if you: frequently travel abroad, need frequent or expensive medical services, or want to limit your health insurance decision-making. You might want to look at different Medicare options if you:- Need frequent or expensive vision, hearing, or dental care
- Want a low monthly premium
- Want bundled coverage
Other Options to Consider
If you decide a Medigap plan isn’t right for you, consider your other Medicare options.
- Medicare Advantage: Medicare Advantage is private insurance that replaces your Original Medicare coverage. These plans include the same hospital and doctor coverage as Medicare Parts A and B, and often include additional benefits. Medicare Advantage Prescription Drug Plans include Part D prescription drug coverage, bundling extra benefits under one plan. However, Medicare Advantage plans limit beneficiaries to a provider network.
- Original Medicare (Parts A and B) only: Original Medicare is administered by the federal government and includes Part A hospital coverage and Part B doctor coverage. Many people do not need to pay for Part A coverage and there is a standardized Part B premium. Those with Original Medicare may enroll in a separate Part D plan for prescription drug coverage.
Putting It All Together
Medigap (Medicare Supplement) plans work with Original Medicare to help cover your out-of-pocket costs. The plans are standardized in 10 categories and don’t feature additional benefits or yearly changes. An Open Enrollment Period when you have Part B and are 65 is your only time with guaranteed Medigap enrollment. At other times, plans can reject you based on pre-existing conditions. A licensed insurance agent or broker can help you find and compare Medicare Supplement plans.