As you approach 65 and transition into Medicare coverage, the first step is to enroll in Original Medicare. From there, you can opt for a Medicare Advantage or Medicare Supplement plan (with a separate stand-alone Prescription Drug Plan). Both work with Original Medicare to help protect you from high health care costs, though they do so in different ways.

What is Medicare Advantage?

Medicare Advantage plans, also called “Part C” or “MA plans,” offer an alternative way to receive your Part A and Part B benefits through private insurance companies that contract with the U.S. Centers for Medicare and Medicaid Services (CMS), instead of through Original Medicare directly. As of 2024, approximately 50% of Medicare enrollees were projected to enroll in a Medicare Advantage plan.¹

Coverage

Medicare Advantage plans cover must cover all the same medically necessary services (under Part A and Part B) that Original Medicare covers. Most Medicare Advantage plans also include Medicare prescription drug coverage (Part D) and extra benefits that Original Medicare does not cover, such as routine dental, routine vision, hearing, fitness, and transportation as part of the same plan.

Although all MA plans must follow certain rules set by Medicare, they aren't standardized. MA plans can charge different out-of-pocket costs and have varying rules on where you can get medical services. For example, an MA plan that is a health maintenance organization (HMOs) will generally require you to see providers within a set network, coordinate care with specialists through a primary care provider (“PCP”). On the other hand, with Original Medicare you can see any U.S. doctor or hospital that accepts Medicare.

Eligibility and enrollment

To join a Medicare Advantage plan, you must have both Medicare Parts A and B and live in the plan’s service area. You can enroll in an MA plan during a few different enrollment periods, including:

• Initial Enrollment Period: A seven-month period that begins three months before you turn 65 and continues three months after your birth month.²
• Annual Enrollment Period: Between October 15th and December 7th each year.³
• Medicare Advantage Open Enrollment Period: Between January 1st and March 31st of each year, if you are already enrolled into an MA plan, you can switch to another MA plan.⁴
• Special Enrollment Period: Availability varies, and only for certain situations that happen in your life, like moving to a new address, losing or changing your current coverage, getting Medicaid, or getting Extra Help to pay drug costs.⁵

Pros and cons

Medicare Advantage plans can help you get various coverage types in a single plan, but also come with a few potential drawbacks.

Pros

• Extra benefits: MA plans often include extra benefits like routine dental, routine vision, hearing, and transportation.
• Drug coverage: Many MA plans include prescription drug coverage.
• Lower premiums: Some MA plans have a $0 monthly premium and some offer what's called a Part B Giveback where a portion of, or even all of, your Part B premium is reimbursed.
• Out-of-Pocket Limitation: Unlike with Original Medicare, MA plans must set an annual limit on your out-of-pocket costs, known as the maximum out-of-pocket (“MOOP”).

Cons

• No foreign travel coverage: MA plans don't typically cover emergency medical care outside of the U.S. (the “U.S.” includes the 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, the Northern Mariana Islands, and American Samoa)⁶
• Out-of-pocket costs: You'll typically have to pay various costs out-of-pocket costs such as deductible, copays, and co-insurance. Although MA plans do have a MOOP, it can still be relatively high. For example, for 2025, the out-of-pocket maximum for MA plans is $9,350 for approved services.⁷
• Provider network restrictions: MA plans may only cover non-emergency care from in-network health care providers and certain MA plans require you to get referrals to see a specialist.⁸

What is Medicare Supplement insurance (Medigap)?

Medicare Supplement insurance, also known as “Medigap”, is a supplemental private insurance plan that helps to cover the out-of-pocket costs not covered by Original Medicare. As of 2022, approximately 42% of people with traditional Medicare had a Medicare Supplement plan.⁹

Coverage

Medicare Supplement plans are sold by private insurance companies, but are generally standardized into the following plan types; A, B, C, D, F, G, K, L, M, and N.¹⁰ All plans of the same letter offer the same primary benefits, despite being offered by different insurers at different price points.¹¹

While the coverage details vary by plan type, Medicare Supplement plans generally cover some or all of the following costs:¹²

• Part A deductibles, hospice care coinsurance or copayments, and hospital costs for an additional 365 days beyond Medicare coverage
• Part B deductibles, coinsurance or copayments, and excess charges
• Blood benefit (up to the first 3 pints)
• Skilled nursing facility care coinsurance
• Foreign travel emergency costs

A few notable benefits Medicare Supplement plans generally don't cover include:

• Prescription drugs
• Dental
• Vision
• Hearing aids
• Private-duty nursing
• Long-term care¹³

Eligibility and enrollment

To qualify for a Medicare Supplement Insurance plan, you need to have Part A and Part B. Under federal law, you get a one-time, six-month “Medicare Supplement Open Enrollment” period that starts the first month you have Medicare Part B and you're 65 or older.¹⁴ During that time, you can enroll in any Medicare supplement policy available in your state you want and the insurance company can't deny you coverage due to pre-existing health problems. If you don't enroll during that period, insurance companies can deny you coverage or charge you more based on your health history.¹⁵

Pros and cons

Medicare Supplement plans can help lower your out-of-pocket costs under Original Medicare and offer flexibility, but it comes with a few limitations that are important to consider.

Pros

• Covers out-of-pocket costs: Medicare Supplement plans help to reduce the out-of-pocket costs that are left over by Original Medicare.
• Guaranteed Coverage: Provided you enroll during your six-month Medicare Supplement Open Enrollment period, you're guaranteed coverage despite past or present health conditions.
• Offers additional coverage: Plans may include additional coverage for blood transfusions, hospital costs, and foreign travel emergency costs.

Cons

• No prescription drug coverage: Medicare Supplement plans don't include prescription drug coverage; this must be purchased separately through a PDP.
• Multiple premiums: Separate premiums are due for Original Medicare, Medicare Supplement, and a PDP.
• Limited eligibility: Pre-existing conditions can increase your plan price or disqualify you from coverage after your Medicare Supplement Open Enrollment period.

Comparing Medicare Advantage and Medicare Supplement

Now that you know the basics of each plan type, let's dig into how they compare in terms of cost, coverage, flexibility, and more.

Cost Comparison

Medicare Advantage plans tend to have cheaper premiums than Original Medicare with Medicare Supplement (and a PDP), but it will vary based on the plan you choose on either side.

Coverage Comparison

Both options include Part A and B coverage, but Medicare Advantage plans often include Part D drug coverage and extra benefits while Original Medicare with Medicare Supplement may cover more out-of-pocket costs.

Flexibility Comparison

Original Medicare with Medicare Supplement offers more flexibility than Medicare Advantage plans.

Long-Term Considerations

The overall costs of your Medicare coverage in retirement will vary based on the plan you choose and the care you end up receiving. However, according to the Employee Benefit Research Institute (ERBI), Original Medicare plans with Medicare Supplement coverage tend to be more expensive in the long run.

In ERBI's analysis, a 65-year-old man enrolled in a Medicare Supplement plan with average premiums and median prescription drug expenditures would need $184,000 to have a 90% chance of meeting his health care spending needs in retirement. A woman in the same situation would need $217,000. In comparison, a man and woman under the same circumstances would only need $99,000 and $116,000, respectively, to cover their health care needs in retirement with a Medicare Advantage plan.²¹

Estimated total required costs to meet health care needs in retirement

Key questions to ask when choosing

As you weigh both options, asking yourself the following questions can help.

• Do you want the flexibility to see any Medicare health care provider across the U.S.? Medicare Supplement generally allows access to any provider that accepts Medicare, while Medicare Advantage often limits you to a network.
• Do you travel frequently, especially abroad? Medicare Supplement typically offers some coverage for foreign travel emergencies, while Medicare Advantage typically does not.
• Are you comfortable managing multiple insurance policies and premiums? Medicare Supplement requires separate plans (i.e., Original Medicare, Medicare Supplement, and PDP), while Medicare Advantage bundles your Part B, Part B, and usually Part D into one plan.
• Do you want extra benefits like routine vision, routine dental, or hearing coverage? Medicare Advantage plans often include these extras, but Medicare Supplement generally plans do not.
• Do you prioritize low costs over flexibility? Medicare Advantage plans may result in lower overall costs but come with more restrictions (e.g., network of providers, referrals).
• Do you need prescription drug coverage included? Medicare Advantage plans often include Part D (Medicare prescription drug coverage), while with Medicare Supplement plans, you'll need to buy a separate stand-alone PDP.
• Do you want protection against large medical expenses? All Medicare Advantage plans limit your maximum annual out-of-pocket expenses while most Medicare Supplement plans don't. However,out-of-pocket costs under a Medicare Supplement for Part A and Part B services do tend to be lower than Medicare Advantage.
• How comfortable are you navigating the details of healthcare plans? Medicare Supplement plans are generally standardized so plans of the same letter are the same across insurance companies. Medicare Advantage plans can vary significantly from one to the next, including for different MA plans offered through the same insurance company.

The bottom line

Choosing a Medicare insurance plan is a major decision that will impact your health care costs and life for many years to come. If you value flexibility and access to any Medicare provider, Original Medicare with Medicare Supplement (and a PDP) might be for you. If low premiums and bundled coverage matter more, Medicare Advantage could be the better fit.

Still feeling uncertain? No problem.Navigating the different Medicare Supplement plans and lineup of Medicare Advantage plans in your region can be a lot to process, but you don't have to do it alone. An InsureMe licensed insurance agent is just a call away and can provide you with personalized guidance based on your unique situation.