Enrolling in a healthcare plan when you turn 65 isn’t a one-step process. Original Medicare covers basic medical care, but it leaves you on the hook for vision, dental, long-term care, and most prescription drugs. It also only covers about 80% of the costs for covered care. Most people choose to fill those gaps either by adding a Medicare Supplement (Medigap) plan or by enrolling in a Medicare Advantage plan as a private alternative.
This guide breaks down how each option works, what it costs, and where the key differences of Medicare Advantage vs. Medigap lie so you can choose the right plan for you. A Chapter Medicare Advisor can also help you compare Medicare Advantage and Medigap based on your preferred care options and budget—all for free.
Key Takeaways:
You can’t have a Medicare Advantage plan and a Medicare Supplement plan at the same time.
Medicare Advantage tends to have lower monthly premiums but higher out-of-pocket costs when you use care; Medigap typically has higher premiums but significantly reduces your out-of-pocket costs.
The right choice depends on your health, budget, doctors, prescriptions, and how much you travel.
Medicare Advantage vs. Medigap comparison
Medicare Advantage addresses the need for an all-in-one healthcare plan with lower monthly costs. It replaces Original Medicare with a private plan that typically bundles Part A, Part B, and in most cases, prescription drug coverage into one package. Your out-of-pockets costs will be higher than if you enroll in a Medigap plan.
Medigap, also known as Medicare Supplement insurance, addresses the problem of unlimited out-of-pocket costs. Like its name suggests, it covers the gaps in Original Medicare by covering out-of-pocket costs, such as deductibles and copays. You’ll have predictable, more manageable costs when you visit the doctor or hospital in exchange for higher monthly premiums.
| Medicare Advantage | Medigap | |
|---|---|---|
| How it works | Medicare Advantage replaces Original Medicare through a private insurer. | Medigap supplements Original Medicare to reduce out-of-pocket costs. |
| Out-of-pocket costs | Expect copayments and coinsurance each time you use care—typically $0–$40 for primary care visits. | Medigap plans significantly reduce—and sometimes eliminate—your out-of-pocket costs. |
| Out-of-pocket maximum | A cap on out-of-pocket costs is required by law; rates vary by plan and year. | No cap needed; Medigap covers most costs |
| Prescription drug coverage | Coverage is usually included. | Prescription drug coverage requires a separate plan (Medicare Part D). |
| Monthly premium | Premiums range from $0 to $15. Medicare Advantage premiums are in addition to the standard Medicare Part B premium. | Premiums are higher but vary by plan and location. Medigap premiums are in addition to the standard Medicare Part B premium. |
| Doctor access | Medicare Advantage offers network-based care; referrals are often required for specialists. | Gain access to any doctor that accepts Medicare coverage nationwide. |
| Travel flexibility | Care access out the plan’s service area is limited. | Medigap is accepted anywhere Medicare is. |
| Extra benefits | Many plans include dental, vision, hearing, and OTC allowances. | Medigap generally offers no extra benefits beyond out-of-pocket cost coverage. |
| Main advantage | Medicare Advantage offers lower upfront costs and extra perks. | Medigap offers broad provider access and predictable costs. |
| Main disadvantage | Medicare Advantage has network restrictions and less predictable coverage and out-of-pocket costs. | Medigap offers no prescription drug coverage and higher monthly premiums. |
| Best for | Medicare Advantage is best for people with tight budgets who have fewer healthcare needs. | Medigap is best for people who see specialists, travel frequently, or want predictable care costs. |
Medicare Advantage plans often include extra benefits like dental, vision, and hearing coverage. But common pitfalls, such as network restrictions and prior authorization requirements, can cause nightmares for Medicare Advantage policyholders. If you need speciality care, it may be delayed or prohibitively expensive.
Which is better: Medicare Advantage or Medigap?
Choosing the best Medicare plan comes down to your personal health needs, budget, and lifestyle.
Medicare Advantage tends to make more sense if you’re relatively healthy, don’t see many specialists/doctors, and prefer lower monthly premiums. It also works well if you’re comfortable staying within a plan’s network and don’t travel frequently outside of your area. But remember that your health needs can change. If they do, you may be unable to switch from Medicare Advantage to a Medigap plan when you want to.
Medigap benefits those who have ongoing health conditions, see multiple specialists, or want the freedom to see any Medicare-accepting doctor nationwide. When comparing plans, remember that premium rates vary based on three Medicare price ratings:
Attained-age: Premiums increase as you get older. This is the most common pricing method and can lead to significant cost increases over time.
Issue-age (entry-age) Premiums are based on your age when you first buy the policy. They don’t automatically rise as you age, though they can still increase due to inflation.
Community: Everyone in the same area pays the same premium regardless of age. This tends to be the most stable method long-term and is required in some states.
Important rules about switching plans
Many people assume they can switch between Medicare Advantage plans and Medigap whenever they want, but in reality Medicare enrollment rules make switching more complicated.
When you first turn 65 and enroll in Medicare Part B, you have a six-month Medigap Open Enrollment Period. During this enrollment window, insurers are required to offer you any Medigap plan available in your area, regardless of your health history. Once that window closes, most states allow insurers to limit offerings through medical underwriting, a process where insurers review your medical history and current health status to assess the financial risk of covering you. These reviews frequently result in higher premiums or outright denial of coverage.
In many cases, you have a guaranteed issue right to change your insurance if you have a Medicare Advantage plan and of the following are true:
Your plan is leaving Medicare.
Your plan stops giving care in your area.
You move out of the plan’s service area
Your plan’s network has changed significantly
Bear in mind that you only have this right if you switch to Original Medicare—you can’t join another Medicare Advantage Plan.
Some states have a “birthday rule” or “anniversary rule” that lets Medigap enrollees switch from one Medigap plan to another without medical underwriting under special circumstances. Connecticut, Massachusetts, and New York offer year-round open enrollment.
| Birthday Rule | |
|---|---|
| CA, DE, ID, MD, NY, OK, OR, WY, IN, KY, VA, IL, LA, UT | You can switch Medigap plans around your birthday. |
| Anniversary Rule | |
|---|---|
| MD | You can switch Medigap plans around your policy anniversary. |
| Year-Round Open Enrollment | |
|---|---|
| CT, MA, NY, WA, ME | You can switch Medigap plans at any time. |
But in most of the country, if you want to leave your Medicare Advantage plan for a Medigap plan, you may find it harder or more expensive to get coverage than if you’d enrolled in Medigap from the start.
If you’re considering switching Medicare coverage, speak with a Medicare broker or advisor to learn your options and enrollment rights.
Get help comparing Medicare Advantage and Medigap
Medicare Advantage and Medigap plans can be difficult to compare by yourself. Plans, premiums, and care costs vary based on your ZIP code, health history, and which healthcare providers you see. The decision you make today could affect your coverage options and costs in the future, so it’s important you fully understand each option.
Chapter offers free Medicare help from licensed, independent Medicare Advisors. They can help you compare Medicare Advantage, Medigap, Part D drug plans, and other coverage options all based on your specific needs.
Chat with us today at 855-900-2427 or book an appointment ahead of time. We’re here to help.
