Are Medicare supplement plans and advantage plans the same type of insurance? If you're not sure whether you need a supplement (also known as Medigap), original Medicare, a Medicare Advantage plan, or another type of health insurance, take a look at the questions to ask right now.

What Is Medigap?

Medicare supplements or Medigap plans do exactly what the name implies. These plans supplement or fill the gaps Medicare leaves for you to pay. While Medicare may cover most of your healthcare costs, this type of plan may still require you to pay out of pocket for deductibles, copayments, or coinsurance.

A Medigap plan can pick up any pay for some or all of the costs your Medicare plan won't cover (with the exception of Part B deductibles for seniors who enrolled on or after January 1, 2020). You must have Medicare Parts A and B to purchase a Medigap plan. Unlike Original Medicare (Parts A and B), you'll need to pay a monthly premium to a private insurer for a Medigap policy.

What Is Medicare Advantage?

With so many different Medicare-related options, it's easy to confuse two or more of the plans. Medigap and Medicare Advantage are both ways to pay for costs Original Medicare won't cover, and they both require you to have Original Medicare (Parts A and B) for enrollment. But that's where the similarities end.

Even though Advantage plans require eligibility for and enrollment in Medicare Parts A and B, the insurance policy itself will take the place of Medicare. This means you won't use the Advantage plan as a secondary insurance or to pay for costs not covered by Medicare. Instead, the Advantage plan insurer will pay for your medical costs — or a percentage of them.

Like the insurance plan you may have had in your pre-Medicare days, an Advantage plan may include an HMO (health maintenance organization), PFFS (private fee for service) PPO (preferred provider organization), or another similar option. The covered expenses and premium costs vary by insurer.  

Which Option Is Right for You?

There's no universal answer to this question. The decision to purchase a Medicare supplement or Advantage plan depends on several factors. These include your personal preferences, budget, medical conditions, and planned uses. If you're not sure which one is right for you, Medicare supplement plan advice from a qualified professional or insurance agent can help you to make the best choice possible.