About Medicare / AMAC Medicare Advisory Service
What You’re Really Getting When You Ditch Your Medigap for an Advantage Plan
Understanding the Basics
Understand how switching from a Medigap to a Medicare Advantage plan affects you. Learn about enrollment periods, medical underwriting, and guarantee issue rights, to ensure you make an informed decision.
Medigap vs Medicare Advantage Plan
Medicare Advantage Plans (Part C) replace Original Medicare. They cover hospital, medical and often Part D (prescription drug coverage) under one plan. A Medicare Supplement Plan (Medigap) works alongside Original Medicare to cover out-of-pocket costs. While both plans aim to help manage healthcare expenses, they function differently and cannot be used together. Therefore, it’s important to understand their key differences.
Major Differences to Consider Before Switching from a Medigap
- Coverage: Medigaps do not cover prescription drugs, dental, or vision. If you need coverage for these services, consider purchasing separate policies. Think of Medigaps like an a la carte plan. In contrast, Medicare Advantage plans often include benefits like prescription drug coverage, dental, and vision care. Specific benefits vary by carrier, but they change each year. Think of Medicare Advantage Plans like a bundled plan.
- Provider Networks: Medicare Advantage plans have provider networks, potentially limiting your choice of providers. Medigaps allow you to see any provider that accepts Medicare in the U.S. and its territories.
- Out-of-Pocket Costs: While Medigap plans often have higher monthly premiums, they can lead to lower out-of-pocket expenses. There are numerous Medigap plan letters, all of which cover a different set of Medicare services. Plan G is one of the most comprehensive Medigap plans; It covers 100% of Medicare-approved expenses once the Part B deductible is met. Medicare Advantage Plans usually offer lower premiums and copays at the time of service. However, Advantage plans have a Maximum Out of Pocket (MOOP), which is an annual spending cap. Once you have met your Maximum Out of Pocket, covered services are paid 100% by the plan for the rest of the calendar year.
Example:
If you have a Medicare Advantage plan and need chemotherapy, you are typically responsible for a 20% coinsurance on the cost of this service, until you have met your MOOP.
Alternatively, if you have a Medigap Plan G, you are responsible for your annual Part B deductible. Your plan pays any additional approved Medicare expenses for the rest of the year.
When Can I Enroll into a Medicare Advantage Plan?
The decision to switch plans cannot be made at just any time; it must be timed according to designated enrollment periods. The Annual Enrollment Period (AEP) occurs from October 15th to December 7th each year. This is a crucial window for those looking to switch from Medigap to a Medicare Advantage Plan. During AEP, you can enroll in, switch, or drop a Medicare Advantage Plan, with changes taking effect on January 1st of the following year.
However, if you make a permanent move, have a change in Medicaid eligibility, or other special circumstance, you may qualify for a Special Election Period (SEP) that allows you to enroll into a Medicare Advantage plan outside of the AEP window.
Medical Underwriting & Guaranteed Rights
Unlike Medicare Advantage Plans, which do not require health questions, switching back to a Medigap plan could be subject to medical underwriting. This could mean higher premiums or even denial of coverage based on health conditions.
If your Medicare Advantage plan ends or you move out of the plan’s area, you may qualify for a Guaranteed Issue Right that allows you to enroll into certain Medigap plans without answering health questions.
Additionally, if you switch from a Medigap to a Medicare Advantage plan for the first time and you decide within a year to go back to your Medigap, you may do so without medical underwriting by using a Trial Right.
Piecing it All Together
Switching from a Medigap plan to a Medicare Advantage Plan involves careful consideration of many factors, including the benefits, costs, provider networks, and the timing of enrollment periods. Understanding the implications of medical underwriting and guarantee issue rights is essential to avoid unexpected hurdles. Before making any changes, it’s advisable to consult with a qualified insurance advisor to discuss your specific needs and circumstances.
For help with Medicare plans – or any questions you may have about Medicare – contact AMAC’s Medicare Advisory Service at 1-855-611-4856 or request a quote here.
