Choosing the Best Medicare Supplements for Your Parents

You may be helping an aging parent with their medical issues and trying desperately to wrap your head around Medicare. You may have inherited whatever choices they made before they came to rely on you to take care of them. And yes, we know that Medicare seems more confusing the more questions you ask. Don’t worry, you’ll eventually “get it.”

We want to help you make the best decisions for your parents so below we’ve broken it all down into small sections that make it easier to understand what a Medicare Supplement plan is and what Medicare Advantage has to offer versus Original Medicare.

Find Out if Your Parent Has Medicare Part A and Part B or Medicare Part C

Before you do anything, find out if they have Medicare. If they didn’t enroll yet, all your options are open. However, if you do not sign up your parent(s) during the Open Enrollment period, you will be fined indefinitely for not having enrolled in time. Open Enrollment starts the beginning of the month your parent turns 65 and is six months long. Make sure you enroll in Medicare Part B during that time frame. You’ll then need to consider whether to choose regular Medicare (Part A) or Medicare Advantage (Part C).

Original Medicare, the government subsidized plan, consists of two parts: Medicare Part A and Part B. Part A covers hospital care and post-hospital care, like a nursing home. Part B, unlike Part A, has a monthly premium payment the government deducts from Social Security payments each month.

If your parent is on Medicare, you have the option of buying Medicare Part C instead of Medicare Part A. Medicare Part C is also known as Medicare Advantage and you can buy it after you enroll in Part B. With Medicare Advantage, you’d have two monthly premiums (for Part Part B and Part C), but the plan would be private, not government subsidized like Part A. You don’t necessarily pay more for one than the other after all costs are considered, so it’s important to consider all the factors, like out-of-pocket costs such as copays and coinsurance as well as your prescription drug plan, which is included in Medicare Advantage.

After you figure out all estimated annual costs, begin comparing Medicare Advantage over Medicare Original. The two plans are simply managed differently and Medicare Advantage includes prescription drug coverage. With original Medicare, you must buy a prescription drug plan from Medicare (Part D).

Remember that your premiums for Medicare Advantage may be more than Medicare Original, but your out-of-pocket costs will likely be lower. There’s also a limit for out-of-pocket costs with Medicare Advantage but not for original Medicare, so you may pay more if you get very sick with regular Medicare.

One way to manage your out-of-pocket costs with regular Medicare is to buy buying Medigap, also called Medicare Supplements (see below).

What Are Medicare Supplements (Medigap)?

If you buy Original Medicare, you can also buy Medicare Supplements (called Medigap), which help pay some of the out-of-pocket costs that go hand-in-hand with Medicare, like copayments, coinsurance and deductibles (usually at least 20% of coinsurance). Medicare Prescription Drug Plans (Part D) is a Medicare Supplement (Medigap). You can buy both Part D prescription drug plan and other Medigap from the same private insurance company.

Medicare supplements are standardized plans, which are again alphabetized: A, B, C, D, F, G and K. Each plan has the same standardized benefits for its letter category, so you never get more from one insurer to another. Only costs will differ, so compare Medigap rates before you buy. See the diagram below.

Medicare Supplement Plans Comparison Chart

Which Medicare Supplements Should I Buy?

As mentioned earlier, each type of supplement will have the same benefits from one company to the next. See the graph below to see what each type of Medigap (A-N) has the coverage your parent needs. You can always add more supplements as you go, making sure to do so during Medicare Open Enrollment in fall, October 15 to December 7. It's very important to compare Medigap rates before you buy.

Compare Medicare Plans Today!

When Can I Buy Medigap?

You can only buy Medigap with Original Medicare not Medicare Advantage. There is a Medigap Open Enrollment Period when prices will be better during and there are more choices. Open Enrollment starts the month you turn 65 and lasts six months. Make sure you are enrolled in Medicare Part B within that time frame. Make sure to do this within those 6 months or you’ll be penalized for the remainder of the time you’re insured. After getting enrolled in Part A and B, buy Medigap. Except in certain states, you can enroll in a Medigap plan at any time. The only requirement is that you're in enrolled in Part A and B.

So, There Are Two Medicare Open Enrollment Dates?

Actually, there are 3! As mentioned above, there’s the 6-month Open Enrollment when you turn 65. The second Medicare Open Enrollment occurs each fall, from October 15 to December 7. During that time, you can switch from Original Medicare to Medicare Advantage, or vice versa.

There’s also the Medicare Advantage open enrollment period runs from January 1 to March 31, and allows Medicare Advantage enrollees to either switch to Original Medicare (plus a Part D plan if they want one) or switch to a different Medicare Advantage plan. However, you can't switch from original Medicare to a Medicare Advantage plan during this time.

What’s Medicare Advantage?

Medicare Advantage is Medicare Part C or a replacement of Original Medicare with a private plan. You still need to qualify for Medicare to buy Medicare Advantage. You’ll also need to enroll in Medicare Part B. Do not confuse Medicare Advantage with Medicare Supplements. Medicare Advantage is an alternative to regular Medicare. Medicare Supplements help pay for out-of-pocket expenses for people who have regular Medicare.

How Does Medicare Advantage Work?

You pay a fixed amount for your coverage each month to a company offering the plan. These companies follow Medicare’s coverage rules and offer the same rights and protections.

Some Medicare Advantage plans offer extra coverage, including vision, hearing, dental and wellness programs. There’s also a limit for what you pay out-of-pocket each year.

Can I Buy Medicare Supplements with Medicare Advantage?

No, you cannot have both Medigap and Medicare Advantage. You must choose one or the other. Medigap only works in conjunction with Original Medicare (Part A and Part B).

Warnings About Changing Medigap Policies

You may be looking to switch a parent’s Medigap policy or you may consider switching from Original Medicare to Medicare Advantage. This is all fine but you must be careful about the timing.

You’ll have to pay a late enrollment fee if you drop your entire Medigap policy and the drug coverage wasn’t creditable prescription drug coverage. You’ll also be fined if you go 63 or more days in a row before your new Medicare drug coverage begins. You need to make the switch as seamless as possible.

Also, to buy Medicare Advantage (MA) you must buy from a private insurer so compare MA rates.

Is Medicare Part D Private Insurance?

Yes, Medicare’s prescription drug plan, Part D, is provided through private insurance companies with contracts with the government, but the plan is provided through the private companies that sell Medigap and prescription drug plans. You also pay a premium directly to the company.

If you have Medicare Advantage versus regular Medicare, your prescription drug plan is most likely included and you do not need to buy Part D.

Prescription drug costs can be back breaking so it’s important that you have a plan in place for your loved one.