Medicare Advantage plans vs. Medicare Supplement insurance

Medicare Advantage plans (Medicare Part C) and Medicare Supplement insurance (Medigap) both supplement Original Medicare (Medicare Parts A and B), but they do so in very different ways.

Medicare Advantage plans are an alternative way to get your Original Medicare benefits, plus additional coverage for dental, vision, and prescription drug coverage.

Medicare Supplement insurance is a type of insurance coverage that helps you pay for your Original Medicare co-payments, deductibles, and other out-of-pocket costs.

Both types of health plans are sold by private companies and require you to be enrolled in Original Medicare to be eligible for coverage.

You cannot have a Medicare Advantage plan and a Medicare Supplement insurance policy at the same time.

The latest statistics show that Medicare Advantage plans are more popular than Medicare Supplement insurance policies. Approximately 14.4 million Medicare beneficiaries were enrolled in Medicare Advantage plans in 2013, according to the Kaiser Family Foundation. More than 10.6 million people were covered by Medicare Supplement insurance that same year, according to the National Association of Insurance Commissioners.

If you want to try out either type of coverage, the Medicare program provides "trial rights" that allow you to switch between them. As you compare your coverage options, remember that you may have the right to try out each option.

If not, you can apply for another Medicare Supplement plan available in your state.

Medicare Advantage plans

When you enroll in a Medicare Advantage plan, you get the same coverage as Original Medicare, plus any additional benefits that come with your specific Medicare Advantage plan. Additional benefits may include prescription drug coverage, dental and vision coverage, and/or wellness programs.

Although Medicare Advantage plans provide at least the same benefits as Original Medicare, they may come with different out-of-pocket costs and network restrictions, depending on the specific plan you enroll in.

Medicare Supplement insurance

If you do not enroll in a Medicare Advantage plan, you can buy a Medigap policy to help pay for Original Medicare deductibles, co-payments, co-insurance, and other costs.

Medigap plan options are regulated by the federal government, but policies are sold by private insurance companies. There are 10 standardized plan options to choose from in most states. Medigap benefits range depending on the plan you choose.

The best time to buy a Medigap policy is during your Medicare Supplement insurance open enrollment period, which is a 6-month period around your 65th birthday.

Trial Rights

If you are unhappy with your Medicare Advantage plan or Medicare Supplement insurance policy and have had it for less than a year, you may be able to try out the other option.

Medicare.gov states "You have a ‘trial right’ to try a Medicare Advantage plan (Part C) and still buy a Medigap policy if you change your mind."

Switching from a Medicare Advantage plan to a Medigap policy

If you joined a Medicare Advantage plan when you were first eligible for Medicare when you turned 65 and you want to change within the first year, you can switch back to Original Medicare and enroll in a Medigap policy.

Medicare.gov states that if you qualify for this trial right, you can choose any Medigap policy provided in your state and you will not have to undergo medical underwriting.

Switching from a Medigap policy to a Medicare Advantage plan

If you cancelled a Medigap policy to join a Medicare Advantage plan for the first time, but you are unhappy with the plan, you may be able to switch back to a Medigap plan if it is within the first year.

To do this, you must disenroll from your Medicare Advantage plan, re-enroll in Original Medicare, and buy a Medicare Supplement insurance policy. If you qualify for this trial right and apply within 63 days after leaving your Medicare Advantage plan, you will be able to make this transition without medical underwriting.

You also will have the right to buy the same Medigap policy you had before you switched to a Medicare Advantage plan as long as your previous insurance company still sells it. If not, you can enroll in Medigap Plan A, B, C, F, K, or L that is available in your state.