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How Supplemental & Advantage Plans are Different

How Supplemental & Advantage Plans are Different

April 01, 2024

To have a Supplemental or Advantage plan, you must first enroll or be enrolled in Medicare Part A & Part B.

#1 Out-of-Pocket

The first difference is your out-of-pocket costs. If you take a Supplemental plan, you pay premiums. Your premium will vary slightly depending on your age, your gender, and where you live. The premium increases as you age and there is usually a yearly premium increase. In addition to paying your premium, you may also have a deductible or out of pocket cost. Based on what the Supplement covers, the responsibilities and costs are transferred to the insurance company.

If you choose an Advantage plan, however, you will have to pay copays. Instead of paying that monthly premium and letting the insurance cover the rest, you will be responsible for a copay. Copays differ per plan. You will pay the copays until you hit a certain max out-of-pocket amount for the year. 

In short, Supplemental plans are premium-based (you pay a fixed amount each month), while Advantage plans are pay-as-you-go with copays.

#2 Networks

The second difference between Supplemental and Advantage plans is the network process. Supplemental plans operate on an open-access system. This means if you are on a Supplemental plan (it does not matter which one), you can go to any doctor or health care provider who takes Medicare. If they accept Medicare, they will never turn you down. 

Advantage plans operate under the network system. If you have an Advantage plan, you will have a specific network of doctors and hospitals that you can visit. Sometimes you can go out of network but that will usually come at a higher cost to you.

#3 Pre-Certifications

The third difference between Supplemental and Advantage plans is the pre-certification process. When you are on a Supplemental plan, your doctor has the final say on whether you need a treatment or procedure. If your doctor wants you to have an MRI or CT scan, then you can get that procedure or test done, and Medicare will pay; no approval is needed. 

However, with Advantage plans, your doctor may have to run procedures and tests through Medicare first to get approved. This is called the pre-certification process, and the insurance provider has the final say in whether you can get the procedure done. 

#4 Perks

The next difference between the two types of plans is perks. Most Supplemental plans do not include things like dental plans, vision plans, or gym memberships. A few companies may add perks to their Supplemental plans, but for the most part, if you want to have these extra things covered, you’ll have to pay a separate cost for them. 

On the other hand, most Advantage plans include perks like dental, vision, over-the-counter benefits, and gym memberships. If perks like a gym membership or dental are important to you, you may consider an Advantage plan. 

#5 Prescription Drug Plan

The fifth difference between Supplemental and Advantage plans is prescription drug coverage. Supplemental plans do not include drug plans. They are always separate. If you get a Supplemental plan, you will have to get a separate drug plan. 

With a Supplemental plan, you may pick from lots of different drug plans to decide which one is best for you based on the medications you take. A separate Rx plan’s monthly premium will cost anywhere from $15 to $100. 

If you are on an Advantage plan, your prescription drug plan will be included in the plan.

#6 Changing Plans

Finally, Supplemental and Advantage plans have different procedures in how you may change your plan. You may change your Medicare Advantage plan or switch from a Supplement to an Advantage Plan during Medicare’s open enrollment period, between October 15th and December 7th.

If you leave a Medicare Supplement plan to join a Medicare Advantage plan for the first time, have been in the plan less than a year, you may go back to Medicare Supplement plan without medical underwriting.  (trial right)

To change to a Medicare Advantage plan, no medical underwriting or answering of health questions is required by the provider.

If you are on an Advantage plan and want to switch over to a Supplemental plan, you will have to go through an underwriting process. This means the provider will require you to answer a series of health questions. The underwriter will also have to know which prescription drugs you are on. While you do not have to be in perfect health to get approved, if something serious is going on with your health, the provider will not approve you for the switch or the provider may rate your premium to a level 2, and you will pay a higher premium.