How to make sure you’re really covered by Medicare 

Most people know that there are two parts to Medicare: Part A and Part B. What they don’t know, however, is that there are other forms of Medicare coverage you can add to Original Medicare to be more fully protected against medical costs.

It’s important to understand your options and the applicable enrollment deadlines so you get the coverage you need without paying a late enrollment penalty.

Option One: Medicare Supplement Plans

A Medicare Supplement Plan, or Medigap plan, helps cover your out-of-pocket costs under Original Medicare. These can include the Part A deductible and coinsurance, Part B coinsurance, and skilled nursing facility coinsurance.

Medigap plans pick up the difference after Medicare pays. Medicare pays its share, and then your provider sends the remaining bill to your Medigap plan. If Medicare accepted the claim, so will the Medigap plan. The Medigap plan pays according to its coverage guidelines, and if there is any remaining balance, the provider bills you directly. Medigap plans only cover Medicare-approved expenses; if Medicare denies your claim, your Medigap plan won’t pay for it, either.

There are several Medigap plan options available today. If you become eligible for Medicare in 2020 or later, you can choose among Medigap Plan A, Plan B, Plan D, Plan G, Plan K, Plan L, Plan M, Plan N, and High-Deductible Plan G. Each plan option covers different expenses. For example, Plan G, the most comprehensive of these plans, covers all Medicare cost-sharing expenses except the Part B deductible. With this Medigap plan, you wouldn’t spend more than the Part B deductible in any given year for covered Medicare services.

Option Two: Medicare Advantage plans

Medicare Advantage plans are an alternative way to get your Medicare benefits. These are private insurance plans and each carrier determines how it will cover your health expenses and what the cost-sharing structure will look like. However, all Medicare Advantage plans must cover, at a minimum, everything covered by Part A and Part B.

Medicare Advantage plans almost always have a lower monthly premium than Medigap plans. If you choose a Medicare Advantage plan, Medicare pays the insurer a set amount each month to cover you. You still must pay your Part B deductible if you choose Medicare Advantage.

Most people are comfortable with Medicare Advantage coverage, because these plans are very similar to employer group plans. You may have to use network providers for all of your routine care, and some plans require a referral and prior authorization for specialist visits.

The Medicare Advantage out-of-pocket maximum is $6,700 in 2020. Some plans set their limit much lower, however, so it’s important to compare plans before you decide. for a Medicare Advantage plan in 2020 can’t be any higher than $6,700.

Most Medicare Advantage plans include Part D coverage for prescription drugs. Medigap plans, on the other hand, cannot be used to help cover your out-of-pocket costs with Part D.

Choose the most cost-effective plan for you

Medicare plans are very personal. There isn’t one plan that is best for everyone. First, decide which type of plan fits your health status and financial situation. Once you’ve decided between Medigap and Medicare Advantage, you can begin to compare different plans and insurers. Remember, you and your spouse can choose different Medicare plans, which is a huge plus if you have different health needs.