There are so many different blogs, articles, and videos out there that are overly complex and complicated. They break down all the tiny details of Medicare Part A and Part B, which can be way too much information. Most of it just isn’t needed. I’m going to give you a clear, short, and sweet explanation of Medicare A and B and the options available, so you can understand it a lot clearer.
When you start on Medicare, most people get Medicare Part A and Part B. Medicare Part A covers hospital stays, and Medicare Part B covers medical services like doctor visits. For most people, there’s no premium for Part A since you’ve already paid into Social Security for 10 or more years. Part B typically costs about $185 per month. If you’re already receiving Social Security every month, they take that premium right out of your check. If you’re not, they usually bill you quarterly.
Original Medicare Coverage
Original Medicare is what they call having just Medicare Part A and Part B without any additional coverage. If you stick with only Parts A and B, whenever you go to the doctor or hospital, you’ll have different deductibles. After you meet those deductibles, you pay 20%, and Medicare covers the other 80%. However, there’s no maximum out-of-pocket limit, and there is no prescription drug coverage.
Because of these potential costs, most people choose additional coverage to help eliminate deductibles and minimize out-of-pocket expenses.
Additional Medicare Coverage Options
To help cover these costs, you have two main options: a Medicare Supplement plan or a Medicare Advantage plan. These two options are very different, and you can only choose one—you are not able to have both of them. It’s one or the other.
Medicare Supplement Plans
As a quick disclaimer to start this section: In everyday language, the word “supplement” is often misused. When people casually say they have a “supplement,” they could mean either a Medicare Advantage plan or a true Medicare Supplement. It’s similar to saying “car” when referring generally to a vehicle. If you say you have a car parked outside, if it’s actually an SUV, most people won’t correct you because they understand that you just mean your vehicle. So, talking with friends or family can sometimes be confusing if they don’t clearly understand the difference. They might say “supplement”, basically trying to communicate their “vehicle” of coverage with Medicare. I like making that disclaimer to help you clarify the difference since so many of us talk with out friends and family about our insurance; and they might innocently be steering us off track al little.
In the insurance world, however, there’s a significant difference between an actual Medicare Supplement plan and a Medicare Advantage plan.
An actual Medicare Supplement plan pays after Medicare. Medicare first covers its share, then your Supplement picks up what’s left over. After your part B premium (typically $185/mon) and your Part B deductible ($257), a Supplement plan covers just about everything after Medicare pays. . These plans are appealing because there’s not much out-of-pocket expense when you use the plan.
The downside of Medicare Supplement plans is their cost. They usually run between $120 and $180 per month, in addition to the Part B premium. Also, these premiums usually increase every year. Over time, they can get pretty expensive. But for many, the peace of mind of having predictable expenses is worth the higher costs.
Medicare Advantage Plans (Part C)
Your other choice is a Medicare Advantage plan, also known as Part C. An easy way to remember Part C is that it connects Parts A, B, and D. Without Part C, you have separate coverage for hospital (A), medical (B), and drugs (D). With a Medicare Advantage plan, everything—doctors, hospitals, and prescription drugs—is combined into one easy-to-manage plan.
So you will have one insurance card for all your medical services. Medicare Advantage plans often can include additional benefits like dental, hearing, vision, gym memberships, and over-the-counter allowances. Depending on your area, you might even have benefits like transportation services, meal delivery, or flex cards that cover various expenses.
It’s important to know that Medicare Advantage plans vary depending on where you live. They are localized. The benefits, networks, and costs can be very different from one zip code to another.
Medicare Advantage vs Supplement Plans
When choosing between a Medicare Advantage plan and a Supplement plan, the biggest factor is your location. Some areas have exceptional Medicare Advantage plans with very low annual out-of-pocket costs, making them a no-brainer. Other areas may have limited or less desirable options, making a Supplement plan the better choice.
It’s important to work with someone knowledgeable about your specific area. Someone who is familiar with the local Medicare Advantage plans and Supplements in your area; they can help you compare all your options based on what you need and where you live. Then you know you’ll receive the most benefits, freedom, cost-effectiveness, and coverage for your situation.
Making the Best Choice for You
Now that you know the bare bones basics of Medicare Parts A, B, and the two additional options available, the next step is figuring out what’s best for your individual situation. This decision should always be personalized because what works perfectly for one person might not be suitable for another.
If you have additional questions or need more details about your specific situation, please let us know. We’re here to help you navigate this important decision. The right choice will depend on various factors, including your health needs, financial considerations, and the local insurance plans available in your area.
Remember, the goal is to find the Medicare option that provides the most peace of mind, comprehensive coverage, and affordability for your unique needs. We’re here to make sure you achieve exactly that.