Medicare can be an overwhelming journey as you reach retirement age. Medicare can be quite different whether you transition from employer coverage, retiree coverage, or marketplace coverage. You can choose from two main types of plans: Medicare Supplement plans and Medicare Advantage plans. However, you can choose from several plans, and the best Medicare plan for you will depend on your budget, medical needs, and lifestyle.
Medicare Supplement Plans
Medicare Supplement plans are also known as Medigap plans. These plans are secondary insurance plans that help cover the gaps in Original Medicare, such as deductibles, copays, and coinsurance. Once Medicare approves a service and pays its portion, the Medigap plan would help cover the remaining balance. However, if Medicare does not cover or pay for a service, the Medigap plan won’t cover the service either.
There are ten standardized Medigap plans and two standardized High Deductible Medigap plans. The 10 Medigap plans are Plan A, Plan B, Plan C, Plan D, Plan F, Plan G, Plan K, Plan L, Plan M, and Plan N. Each plan covers different Medicare benefits, so your out-of-pocket costs will vary with each plan. However, since the coverage is standardized, every carrier that offers a specific plan must provide the same coverage. For example, Plan G with carrier ABC must offer the coverage as Plan G with carrier XYZ. For more information on these plans, visit Boomer Benefits – Medicare.
Additionally, since they are secondary plans, you can see any provider that accepts Original Medicare across the nation. However, they do not cover prescription drugs, so you would need a Part D plan along with your Medigap plan.
Medigap Plan G
Medigap Plan G is one of the most popular plans in 2022. Plan G helps cover all gaps in Original Medicare, except the Part B deductible. To satisfy that deductible, you would pay the first $233 for Part B services in 2022. Once it is met, Medicare covers 80% of Part B services, and Plan G covers the remaining 20%. Additionally, Plan G covers the Part A hospital deductible and coinsurance, skilled nursing facility coinsurance, hospice coinsurance, and Part B excess charges.
Plan G is also one of the few Medigap plans that offer some foreign travel emergency coverage. Plan G will cover 80% of emergency care in another country after you pay the first $250. Once Plan G has paid $50,000 toward foreign travel emergency care, you are responsible for all costs.
Medicare Advantage Plans
Medicare Advantage plans are referred to as Medicare Part C. When you enroll in an Advantage plan, you receive your Medicare Part A and Part B benefits from the plan. The Advantage plan will manage your care and set specific copays or coinsurance for each service it covers. Advantage plans can also include prescription drug coverage, so you would not need a standalone Part D plan.
These plans are based on your zip code and county, so a plan that may work best for you may differ from someone in another location. Additionally, these plans have networks of providers. You could have an HMO or PPO Advantage plan. An HMO plan will have a smaller provider network than a PPO plan. You would only have coverage with in-network providers except for emergencies. However, a PPO plan will provide coverage with in-network and out-of-network providers. Keep in mind that you may have a higher cost-sharing for out-of-network services.
The right Advantage plan for you will have your providers in-network and cover your prescriptions.
Medicare Part D plans
Medicare Part D is the prescription drug program with Medicare. Part D plans are offered by private insurance companies and help cover most retail drugs that you pick up from the pharmacy. Each plan has a different list of medications, although all drug plans must cover at least two drugs in each therapeutic class.
These plans are also based on your zip code, so you would want to find a plan available in your area that is most cost-effective for your drugs. You can change Part D plans each year, so if your drugs change from year to year, you will be able to change your plan during the Annual Election Period.
The right plan for you all depends on which one will be most cost-effective and meets your medical needs. There is not one specific plan that is best as every individual has different needs. You can consult with a reputable Medicare broker to help you determine what plan will be best for you.