Types of Medicare Plans

Choosing the right Medicare plan is easier once you learn about the different types of coverage.

There are two types of Medicare coverage: (1) Medicare Part A and Part B and (2) Private Medicare Insurance.

Medicare Part A and Part B:

Medicare Part A and Part B is offered by the federal government. It provides basic inpatient and outpatient health coverage. You must be 65 years or older to be eligible. You must be 65 years or older to be eligible, or you must have a qualifying disability.

Some individuals who need frequent medical care find that out-of-pocket costs may be unaffordable with Medicare Part A and Part B alone. That’s because Medicare Part A and Part B does not have a limit or cap on out-of-pocket costs.

Medicare Part A and Part B also provides prescription drug coverage only to those under inpatient care. In other words, those who regularly take prescription medication might end up paying for some of their drug costs out of their own pocket. Additionally, Medicare Part A and Part B does not provide coverage for dental, vision, certain long term care, health care when traveling overseas, and other benefits.

Learn more about Medicare Part A and Part B here.

Private Medicare:

Private Medicare insurance is a great way to lower your out-of-pocket costs and get additional health care benefits. In other words, Private Medicare Insurance may help provide additional coverage where Medicare Part A and Part B do not provide coverage.

There are three types of Private Medicare plans:

1) Medigap

2) Medicare Advantage

3) Medicare Part D.

Medigap plans, also known as Medicare Supplement plans, are purchased in addition to your Medicare Part A and Part B coverage. These plans may lower your out-of-pocket costs. Most Medigap plans will also pay for your out-of-pocket costs when visiting the doctor, or that 20% of costs that Medicare Part A and Part B Part B does not pay. Many Medigap plans also offer additional benefits, such as long term care, or coverage for emergency medical services when traveling overseas. In turn, Medigap plans have monthly premiums that must be paid for coverage. Learn more about Medigap plans here.

Medicare Advantage plans offer the same benefits that Medicare Part A and Part B offers, and also provides additional coverage as well. This is why Medicare Advantage plans replace, instead of complement, Medicare Part A and Part B plans. Additional coverage varies depending on the insurer and the plan. For this reason, Medicare Advantage may feel similar to the HMO and PPO plans you may have previously had through an employer. Medicare Advantage plans may help to lower your out-of-pocket costs. Additionally, and unlike Medicare Part A and Part B, Medicare Advantage plans place a limit on your total out-of-pocket costs. However, many plans may have substantially lower limits. Learn more about Medicare Advantage plans here.

Medicare Part D plans provide you with full prescription drug coverage. Medicare Part A and Part B only includes prescription drug coverage when hospitalized. It does not cover prescription drugs obtained at the pharmacy or through the mail. For those who regularly take prescription medication, it is recommended to purchase a Medicare Part D plan. These plans can be purchased as a standalone plan -- to be used alongside Medicare Part A and Part B or with Medigap - or they can be included within a Medicare Advantage plan. Learn more about Medicare Part D plans here.

To start comparing Medigap, Medicare Advantage, and Part D plans, please submit your zip code to begin the process.