Medicare Advantage Plan And Medigap: Similarities And Differences

Jul 16, 2021

Medicare Advantage Plan (or “Part C”) and Medicare Supplement Insurance (or Medigap) are both ways for you to protect yourself from healthcare costs. Even though they are structured and work differently the end goal is the same for the consumer to have less out of pocket expenses than if you were to use original Medicare on its own.

What Healthcare Costs Do Each Cover?

Medicare advantage plans are designed like a traditional insurance plan, meaning you will have one care and it will cover Medicare part A (hospital/Inpatient coverage) Medicare part B which could be anything for outpatient needs, doctor visits, lab work, test ect. And most Medicare advantage plans will cover part D prescription coverage as well. Medicare advantage plans must cover everything that original Medicare covers as GOOD or BETTER. 

Medicare supplement/Medigap plans work with original Medicare and pick all or most of the deductibles and coinsurance not covered by original Medicare. However Medicare supplement plans DO NOT cover part D prescription drugs so if you need this coverage you will have to add a stand alone part D drug plan.

Who is Qualified for Each Healthcare Plan?

When you are first eligible for Medicare whether it’s when you first turn 65 or you are getting on Medicare after as long as you have had continuous health insurance coverage you will have a guarantee issue right for Medicare advantage and Medicare supplemental coverage. Medicare advantage plans NEVER have underwriting and you can not be denied coverage for health reasons. Medicare supplement plans on the other hand have underwriting in most states if you are outside your guaranteed issues period, there are some exceptions so you should always consult with an agent if you are unsure. Both plans require you to have both parts A&B to enroll and you must also reside in the plans service area. Plan coverage and options for both Medicare advantage and Medicare supplemental plans vary greatly by location. We may not always get the same coverage as our friends and family if they do not live in our zip code as us.

Main Coverage Differences between Medicare Advantage & Medicare Supplements.

While these plans are both designed to help you with out of pocket medical costs they do it quite differently. When you have a medicare supplement which is private insurance that helps you pay for Medicare deductibles and coinsurance. This coverage works along with original Medicare and you will have to present your Medicare card along with it for proper billing coordination. Most Medicare supplement plans will cover the Medicare part A deductible and help either partially or in full with the part B coinsurance. However since January 2020 no one aging into Medicare will be able to have their part B medical deductible covered. Also very important to know ALL medicare supplement plans have a premium and all though each plan which are named by letters A,B,C,D,F,G,KL,M,N and each plan that offers a Plan G has the same exact plan G as every other carrier offering it they may have very different premiums. So for instance you may have 10 carriers offering coverage in your state and plan G can be 10 different prices for the same exact coverage. Price is important to most of us, and when it comes to Medicare supplement plans you just need to pay attention to not only the starting price but the carriers rate history, how quick they pay the doctors and lastly customer service reputation. The thing you need to be aware of is many times you will find a carrier with a lower rate but they have a tradition of large rate increases and depending on your health changing plans later is not always a guarantee. Medicare supplement plans pay doctors and hospitals more, have less restrictions when it comes to providers and referral policies and generally have more cost predictability. So you will pay more up front for a supplement plan and need to add part D drug coverage but you will have access to more medical providers, no referrals or prior authorizations and more cost predictability.

Medicare advantage plans come in many shapes and sizes but in general they work the same. You will have a private insurance company take over your Medicare coverage and provide you with an all in one type coverage A,B, & D all together. These plans usually have low or no premium at all since they are subsidized by our taxes. The Medicare advantage plans will many times offer benefits that original Medicare does not cover like dental, vision and hearing.These plans typically have networks like PPO or HMO, some plans networks are very large and some are small and anywhere in between. All of the Medicare advantage plans will have a maximum out of pocket amount to limit the amount you may be charged for medical expenses throughout the year. Original Medicare does NOT have this and is a big reason for needing some additional coverage other than traditional Medicare alone.


Both Medicare advantage plans and Medigap/Medicare supplement plans can be very useful in protecting us financially from large medical bills. Medicare supplement plans tend to cost much more up front but they cover more comprehensively, they give you more flexibility in finding a doctor and less red tape to get things done . (test, surgeries etc) Medicare advantage plans provide low or no premiums along with some extra benefits that original Medicare does not cover. However they will require prior authorizations for cat scans, surgeries and other procedures. They may require referrals to see specialists and have other rules for you to follow to get benefits.  As people we all have different health needs, budgets and lifestyles and I believe there is no ONE best plan for everyone, the most important thing is to get educated, do your research and choose the plan that fits you personally the best. 


As an individual you should really give some thought to what your needs are, how much you can afford monthly for a budget and start to write down what is truly most important when it comes to healthcare.

At The Modern Medicare Agency, we know Medicare is not a one size fits all type of deal and that is why we offer as many options as possible so that we can offer the most suitable options to clients on an individual basis. If you would like to learn more about your options or just have general questions please give us a call 631-358-5793 our team of friendly experienced agents will be happy to speak with you.