The following are the five choices you have when deciding on the type of coverage as a Medicare recipient:
- Original Medicare
- Medicare Advantage Plan
- Original Medicare+ Supplemental (Gap) Insurance
- Original Medicare+ Prescription Drug Plan
- Original Medicare+ Supplemental (Gap) Insurance + Prescription Drug Plan
Here’s another way to look at it:
Original Medicare (Medicare Part A + Medicare Part B)
Medicare Part A (Hospital Coverage) covers hospital inpatient care, skilled nursing facility (not custodial or long-term care), home health care, hospice care, blood transfusions, and in-patient care in a religious non-medical health care facility. Medicare Part B (Medical Insurance) covers doctors and other health care providers, outpatient care, home health care, durable medical equipment, and approved preventive services.
The majority of people over 65 years old automatically get enrolled into Medicare Parts A and B if you paid into Social Security for 10 years or more. If you contributed for fewer than 10 years to Social Security, then Medicare is still offered, though, at a premium fee.
A Medicare Advantage Plan is a type of Medicare health plan offered by a private company that contracts with Medicare to provide you with all your Part A and Part B benefits. Medicare pays a fixed amount for your care each month to the companies offering Medicare Advantage Plans. These companies must follow rules set by Medicare.
Medicare Advantage Plans include Health Maintenance Organizations, Preferred Provider Organizations, Private Fee-for-Service Plans, Special Needs Plans, and Medicare Medical Savings Account Plans. If you’re enrolled in a Medicare Advantage Plan, Medicare services are covered through the plan and aren’t paid for under Original Medicare.
Not all Medicare Advantage Plans work the same way, so before you join, take the time to find and compare Medicare health plans in your area. Visit the plan’s website to see if you can join online or Fill out a paper enrollment form. When you join a Medicare Advantage Plan, you’ll have to give the information that is on your Medicare card.
Though Medicare pays a fee for to the Advantage plans, each Medicare Advantage Plan can charge different out-of-pocket costs and have different rules for how you get services (like whether you need a referral to see a specialist or if you have to go to only doctors, facilities, or suppliers that belong to the plan for non-emergency or non-urgent care). These rules can change each year.
You usually get prescription drug coverage (Part D) through the plan. In some types of plans that don’t offer drug coverage, you can join a Medicare Prescription Drug Plan.
You can’t have prescription drug coverage through both a Medicare Advantage Plan and a Medicare Prescription Drug Plan. If you’re in a Medicare Advantage Plan that includes drug coverage and you join a Medicare Prescription Drug Plan, you’ll be disenrolled from your Medicare Advantage Plan and returned to Original Medicare.
Original Medicare + Supplemental (Gap) Insurance
This option includes an original Medicare and additional supplemental coverage. A Medicare supplement (Medigap) insurance, sold by private companies, can help pay some of the health care costs that Original Medicare doesn’t cover, like copayments, coinsurance, and deductibles.
Some Medigap policies also offer coverage for services that Original Medicare doesn’t cover, like medical care when you travel outside the U.S. If you have Original Medicare and you buy a Medigap policy, Medicare will pay its share of the Medicare-approved amount for covered health care costs. Then your Medigap policy pays its share.
A Medigap policy is different from a Medicare Advantage Plan. Those plans are ways to get Medicare benefits, while a Medigap policy only supplements your Original Medicare benefits. Medigap policies generally don’t cover long-term care, vision or dental care, hearing aids, eyeglasses, or private-duty nursing.
Original Medicare + Prescription Drug Plan
This option includes an original Medicare and additional Prescription Drug Plan (Medicare part D). Medicare Prescription Drug Plans (Part D) (sometimes called “PDPs”) add drug coverage to Original Medicare, some Medicare Cost Plans, some Medicare Private Fee-for-Service (PFFS) Plans, and Medicare Medical Savings Account (MSA) Plans. If your Medicare Advantage Plan (Part C) includes prescription drug coverage and you join a Medicare Prescription Drug Plan (Part D), you’ll be disenrolled from your Medicare Advantage Plan and returned to Original Medicare.
Original Medicare+ Supplemental (Gap) Insurance + Prescription Drug Plan
This option includes an original Medicare, a gap (supplemental) insurance to cover for services that the original Medicare doesn’t and additional Prescription Drug Plan. When creating this combination make sure that there is no overlap in the coverage and look through available Advantage programs in your area because these may offer a comprehensive coverage that may be less expensive than the combination of the three.
Source: Medicare.gov