Contrary to common belief, you won’t just enroll in Medicare at 65 and then be done with it. Actually, Medicare encompasses many different parts, and there are even Medicare options offered by private insurance companies. Putting together the right plan, or combination of plans, will help you to manage your healthcare expenses throughout retirement. Plus, each year you have the opportunity to change your Medicare plan during Medicare’s Annual Election Period.
So as you confront that maze of decisions, you will start to learn about the different types of Medicare plans out there. One common question that we hear a lot is, “What is the difference between a Medicare Advantage Plan and a Medicare Supplement Plan?”
A Medicare Advantage Plan is simply an insurance plan, offered by a private insurance company, that complies with certain standards set forth by Medicare. These plans operate based upon a network of providers and facilities, and might feel similar to the healthcare plan you enjoyed pre-retirement. They all encompass Medicare Parts A and B, and some also include Part D (prescription drug) coverage.
A Medicare Supplement Plan, or Medigap plan, is designed for those who enroll in Original Medicare (Parts A and B) to help them manage out-of-pocket expenses. A Supplement Plan covers out-of-pocket expenses like your co-pays and deductibles, and even some uncovered services such as healthcare that you receive when traveling outside of the country. This type of plan can be a good option for those who want to stick with Original Medicare, but are worried about fluctuating out-of-pocket expenses. You cannot use a Supplement Plan with Medicare Advantage.
Hopefully that clears up the issue for you! But if you have any other questions about the different types of Medicare plans available to you, just give us a call. And remember, Medicare’s Annual Election Period begins on October 15. Get ready to make a decision about your healthcare plan for 2022.