Medicare Advantage vs. Medicare Supplement (Medigap): What’s the Difference?
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Medicare Advantage and Medicare Supplement Insurance, also called Medigap, are two very different types of coverage. Although both can be part of someone's Medicare coverage, they work in different ways and are not used together.
Quick answer: Medicare Advantage is an alternative way to receive your Medicare Part A and Part B benefits through a private insurance company that contracts with Medicare. Medigap works alongside Original Medicare and helps pay certain out-of-pocket costs that Original Medicare leaves to the beneficiary.
For a broader overview of Medicare coverage, costs, plan options and enrollment, see our complete guide to Medicare in California.
What Is Medicare Advantage?
Medicare Advantage, also known as Medicare Part C, is an alternative way to receive Medicare Part A and Part B benefits.
Medicare Advantage plans are offered by private insurance companies that contract with Medicare.
To join a Medicare Advantage plan, you generally must have Medicare Part A and Part B and live in the plan's service area.
Medicare Advantage plans provide your Part A and Part B benefits, and most plans also include Medicare Part D prescription drug coverage.
Depending on the plan, additional benefits may also be available, such as certain dental, vision, hearing or wellness benefits.
What Is Medicare Supplement Insurance?
Medicare Supplement Insurance is commonly called Medigap.
Medigap is private insurance designed to supplement Original Medicare.
Original Medicare pays its share of covered health care costs first, and a Medigap policy can then help pay certain remaining out-of-pocket costs according to the policy's benefits.
Depending on the Medigap plan, this may include certain deductibles, copayments and coinsurance.
Medigap does not replace Original Medicare. It works alongside Medicare Part A and Part B.
Medicare Advantage vs. Medigap at a Glance
| Medicare Advantage | Medigap |
|---|---|
| Alternative way to receive Medicare benefits | Supplements Original Medicare |
| Also called Medicare Part C | Also called Medicare Supplement Insurance |
| Offered by private insurance companies that contract with Medicare | Offered by private insurance companies |
| May use provider networks | Generally works with providers that accept Original Medicare |
| Most plans include Part D prescription drug coverage | Modern Medigap policies do not include prescription drug coverage |
| May offer additional benefits | Primarily helps with certain Original Medicare cost-sharing |
| Has an annual out-of-pocket limit for covered Part A and Part B services | Benefits depend on the standardized Medigap plan selected |
Can You Have Medicare Advantage and Medigap at the Same Time?
No. Medigap is designed to work with Original Medicare, not Medicare Advantage.
A Medigap policy cannot be used to pay Medicare Advantage deductibles, copayments or coinsurance.
It is also generally illegal for an insurance company to sell you a Medigap policy if the company knows you have Medicare Advantage unless you are switching back to Original Medicare.
How Do Provider Networks Differ?
Medicare Advantage plans may use provider networks.
Depending on the plan type, receiving routine care outside the plan's network may cost more or may not be covered. Plans can also have defined service areas.
With Original Medicare and Medigap, you can generally use any doctor or hospital in the United States that accepts Medicare. The Medigap policy follows the Original Medicare coverage rather than creating a separate Medicare Advantage provider network.
This can be an important distinction for people who regularly travel or receive care in more than one state.
How Do Costs Work With Medicare Advantage?
Medicare Advantage plans can have their own premiums, deductibles, copayments and coinsurance within Medicare requirements.
Some Medicare Advantage plans may have a $0 additional monthly plan premium, but a $0 plan premium does not mean health care is free.
You generally continue paying your Medicare Part B premium, and cost-sharing can apply when you receive health care services.
Medicare Advantage plans have an annual limit on what you pay out of pocket for covered Part A and Part B services.
How Do Costs Work With Medigap?
With Medigap, you remain enrolled in Original Medicare and generally pay a separate monthly premium for the Medigap policy in addition to your Medicare Part B premium.
The Medigap policy then helps pay certain costs left by Original Medicare according to the benefits of the Medigap plan you purchased.
Premiums for the same Medigap plan can vary between insurance companies even though standardized plans with the same letter generally provide the same basic benefits.
Premiums can also vary based on factors permitted under applicable federal and state rules.
Are Medigap Plans Standardized?
In most states, Medigap policies are standardized and identified by letters, such as Plan G or Plan N.
Policies with the same letter generally provide the same standardized basic benefits regardless of which insurance company sells the policy, although premiums can differ.
Massachusetts, Minnesota and Wisconsin standardize Medigap policies differently.
Medigap plan availability and enrollment protections can also vary based on location and individual circumstances.
Does Medicare Advantage Include Prescription Drug Coverage?
Most Medicare Advantage plans include Medicare Part D prescription drug coverage.
Each plan can have its own formulary, pharmacy network and cost-sharing requirements.
It is important to review how a plan covers your medications rather than assuming all Medicare Advantage plans cover prescriptions in the same way.
Does Medigap Include Prescription Drug Coverage?
Medigap policies sold today do not include prescription drug coverage.
People with Original Medicare and Medigap who want Medicare prescription drug coverage can generally enroll in a separate Medicare Part D plan.
Learn more in our guide to Medicare Part D and prescription drug coverage.
What Additional Benefits Can Medicare Advantage Offer?
Medicare Advantage plans may offer certain benefits beyond what Original Medicare covers.
Depending on the plan, these may include certain:
- Dental benefits
- Vision benefits
- Hearing benefits
- Fitness or wellness benefits
Additional benefits vary by plan and may include limits, networks or other requirements.
Medigap is structured differently. Its primary purpose is to help with certain cost-sharing under Original Medicare rather than provide the same type of additional benefits that may be offered by Medicare Advantage plans.
When Can You Buy a Medigap Policy?
Medigap has enrollment rules that are different from Medicare Advantage and Part D enrollment periods.
Your federal Medigap Open Enrollment Period generally lasts six months and begins when you are age 65 or older and enrolled in Medicare Part B.
During this period, insurance companies generally cannot use medical underwriting to deny you a Medigap policy or charge you more because of pre-existing health problems.
After this federal Medigap Open Enrollment Period ends, your options may be different unless you have a guaranteed issue right or another protection under applicable law.
State rules can provide additional Medigap protections beyond federal requirements.
Is Medigap Open Enrollment the Same as Medicare Open Enrollment?
No. These are different enrollment periods.
Medicare Open Enrollment occurs each year from October 15 through December 7 and allows Medicare beneficiaries to make certain changes involving Medicare Advantage and Medicare prescription drug coverage.
Medigap Open Enrollment is generally a one-time six-month period that begins when you are age 65 or older and enrolled in Medicare Part B.
The annual Medicare Open Enrollment Period does not create a new federal Medigap Open Enrollment Period every year.
Can You Switch From Medicare Advantage to Original Medicare and Medigap?
There are Medicare enrollment periods when eligible beneficiaries can leave Medicare Advantage and return to Original Medicare.
However, being allowed to return to Original Medicare does not necessarily mean you will automatically have the right to purchase any Medigap policy you want.
Your ability to purchase Medigap can depend on your timing, previous coverage, guaranteed issue rights and applicable state law.
Because Medicare Advantage enrollment rules and Medigap enrollment rules are separate, both should be understood before making a coverage change.
Can You Switch From Medigap to Medicare Advantage?
If you have Original Medicare with Medigap, you may be able to join a Medicare Advantage plan during an applicable Medicare enrollment period.
If you drop your Medigap policy, however, you may not necessarily be able to purchase the same Medigap policy again later.
Federal and state protections can apply in certain circumstances, but the rules depend on your situation.
How Does Original Medicare Fit Into This?
Understanding the difference between Original Medicare and Medicare Advantage is important before comparing Medicare Advantage with Medigap.
With Original Medicare, Medicare Part A and Part B provide your primary coverage. A Medigap policy can then supplement that Original Medicare coverage.
With Medicare Advantage, the Medicare Advantage plan provides your Medicare Part A and Part B benefits instead.
See our guide to Original Medicare vs. Medicare Advantage for a more detailed explanation.
What Should You Compare?
Medicare Advantage and Original Medicare with Medigap structure coverage differently.
Important factors to understand when comparing how the two approaches work include:
- Monthly premiums
- Deductibles, copayments and coinsurance
- Doctors and hospitals you use
- Provider network rules
- Prescription drug coverage
- Expected health care use
- Coverage while traveling
- Additional benefits
- Medigap eligibility and enrollment protections
- Potential future coverage changes
Costs, benefits and availability can vary, so comparisons should be based on current plan information and individual circumstances.
Frequently Asked Questions
Is Medigap the same as Medicare Advantage?
No. Medicare Advantage is an alternative way to receive Medicare Part A and Part B benefits. Medigap supplements Original Medicare by helping with certain out-of-pocket costs.
Can I have Medicare Advantage and Medigap together?
No. Medigap is designed to work with Original Medicare and cannot be used to pay Medicare Advantage plan cost-sharing.
Does Medigap replace Medicare Part A and Part B?
No. You remain enrolled in Original Medicare Part A and Part B. Medigap supplements that coverage.
Does Medigap include Part D prescription drug coverage?
Medigap policies sold today do not include prescription drug coverage. People with Original Medicare can generally purchase a separate Medicare Part D plan.
Does Medicare Advantage usually include Part D?
Most Medicare Advantage plans include Part D prescription drug coverage, although plan designs and availability vary.
Can Medicare Advantage plans have a $0 premium?
Some Medicare Advantage plans may have a $0 additional monthly plan premium. You generally must continue paying your Medicare Part B premium, and other out-of-pocket costs can still apply.
Can I buy Medigap whenever I want?
You may apply for Medigap at other times, but your federal protections can differ outside your Medigap Open Enrollment Period or another guaranteed issue situation. State protections may also apply.
Is Medicare Open Enrollment from October 15 through December 7 also Medigap Open Enrollment?
No. Annual Medicare Open Enrollment and the federal Medigap Open Enrollment Period are separate enrollment periods with different rules.
This article is for general educational and informational purposes. Medicare and Medigap eligibility, benefits, premiums, enrollment protections, underwriting rules and plan availability can vary based on individual circumstances, location and applicable law and may change over time. For official Medicare information, visit Medicare.gov or call 1-800-MEDICARE.