Changing from Medigap to Medicare Advantage

As Medigap premiums go up, more and more people are thinking about changing from Medigap to Medicare Advantage. All the celebrities on TV can’t be wrong, right? It’s no secret that Medicare Advantage plans are attractive for a number of reasons, but before you decide to make the switch, there are a few things you should consider.

Medicare Advantage Plans Have Smaller Networks

Beneficiaries who have Original Medicare (Parts A and B) with (or without) a Medicare Supplement plan have access to a large network of healthcare providers. The majority of facilities and physicians accept Medicare, which gives beneficiaries a lot of freedom to choose where they get their care.

On the other hand, Medicare Advantage plans use smaller provider networks, usually based in a certain geographic area. The size of the network partially depends on where you live, with rural areas having even smaller networks than urban ones.

Before you change from Medigap to Medicare Advantage, you’ll want to find out if your current providers accept Medicare Advantage. Specifically, you’ll need to find out which plans they take. Private insurance companies sell Medicare Advantage plans, and your provider may not be contracted with all of them.

Medicare Advantage Plans Have More Rules

The part of Medicare Advantage plans most people end up getting frustrated with is their rules and requirements. To keep their costs low, insurance companies use prior authorizations and step therapy.

Prior authorization requires your providers to submit the recommended treatment to the insurance carrier. The company will then decide if it will cover the treatment or not. 

Step therapy is a rule that says you must try less invasive, cheaper forms of treatment or medications before moving on to more costly ones.

Both of these approaches will delay your medical treatment and may even prevent you from getting the care you need.

You May Have Higher Out-of-Pocket Costs

Medicare Advantage plans have low monthly premiums. In fact, you probably have several plans offering a $0 premium in your area. This doesn’t mean the plans are free. There are other costs like deductibles, copayments, and coinsurance that you’ll be required to pay.

This “pay-as-you-go” option sounds appealing. The downside is that your healthcare costs become impossible to predict. 

For example, let’s say you have Medigap Plan G. Outside of your monthly premiums, you know your only cost is the Part B deductible. With a Medicare Advantage plan, you pay for services as you need them. All Medicare Advantage plans have a maximum out-of-pocket (MOOP), but this is usually several thousand dollars.

The biggest expenses in most Medicare Advantage plans are chemotherapy, radiation, and dialysis. These treatments are usually set at 20% cost-sharing.

Switching Back to Medigap Isn’t Guaranteed

You may have heard people say that once you switch to Medicare Advantage, you can’t go back. That’s not exactly true, but it may be the case for some people.

You can always switch from Medicare Advantage back to Original Medicare. However, you may not always be able to get back on a Medigap plan. During your Medigap Open Enrollment Period, which lasts for six months after your Part B effective date, you can enroll in any Medigap plan you choose. Once those six months have passed, you won’t enjoy the same guaranteed issue rights.

The exception to this lies within your first 12 months of trying Medicare Advantage. This is called your trial right period. If, at any time during those 12 months, you want to change back to Medigap, you may do so without medical underwriting.

After your trial right passes, you can only get a Medigap plan if you are healthy enough to pass the insurance company’s underwriting process.

Tips for Changing from Medigap to Medicare Advantage

If you feel like the Medicare Advantage pros still outweigh the cons, and you want to switch to Medicare Advantage, the advisors at Local Medicare Specialists are happy to walk you through the process. Let’s talk about the steps we’ll take if you decide to make the switch.

1. Add your prescriptions to Medicare’s Plan Finder tool to find out which Medicare Advantage plans cover all your medications at the lowest cost.

2. Decide if you want coverage outside of your plan’s network. If so, you’ll want to enroll in a Medicare Advantage PPO plan. HMO plans have no outside coverage but do offer lower out-of-pocket costs.

3. Compare premiums, deductibles, and cost-sharing amounts, especially for services you know you are likely to need.

4. After your enrollment is complete, mark your calendars for Medicare‘s Annual Election Period (October 15 - December 7), because you’ll need to review your Medicare Advantage plan during that time.

5. Cancel any plans you no longer need. For example, cancel your Medigap plans and any supplemental policies that are now part of your Medicare Advantage plan. For example, most Medicare Advantage plans offer coverage for dental, vision, and hearing benefits, so you won’t need an extra policy to cover those areas.

Deciding if you want to change from Medigap to Medicare Advantage is a personal decision. Many people have no problems with Medicare Advantage and enjoy the low premiums and extra benefits.

If you’ve had a Medigap plan for many years, sometimes the transition to Medicare Advantage can be rocky. Understanding the biggest differences between Medigap and Medicare Advantage will prepare you for the changes you’ll encounter. 

Want to know more about Medicare Advantage plans? Find a local Medicare advisor near you and start exploring plans in your area today.