This is the first question you should ask yourself when nearing age 65 and getting ready to go on Medicare. There are advantages to both but neither option is necessarily right for everyone so let’s look at some of the differences.

Medicare + Medicare Supplement + Stand Alone Prescription Drug Plan (Part D)

In my experience this has been the most popular option that seniors take advantage of. With original Medicare, and a Medicare Supplement Plan F, seniors will be able to see any doctor, or go to any hospital that accepts original Medicare. This option is excellent for seniors that like to travel. Seniors that may have a residence in another state. The reason is there are no networks or referrals to deal with like Medicare Advantage plans. Many seniors like to have their health care costs as a fixed expense. They know with a Medicare Supplement and original Medicare, that they will never be surprised with co-pays or deductibles.

Medicare Advantage

Medicare Advantage has been a popular option for some seniors. Many of the plans have little or no monthly premiums, and include an integrated prescription drug plan which seniors will find very attractive. The downside of Medicare Advantage is that when you do use the plan the co-pays and deductibles can be surprisingly high. These plans also may require referrals. You can only go to doctors within the insurance companies’ network. If you are very healthy and see the doctor a few times a year if at all, a Medicare Advantage plan may be a good option. Each year that goes by and you do not use the plan the savings in premiums can add up.

In conclusion, it’s a “pay me now or pay me later” comparison. You can pay a fixed monthly expense for a Medicare Supplement and stand-alone Prescription Drug Plan and know in the future you will not pay co-pays, deductibles, and have no referrals or networks to deal with, or you can opt for a Medicare Advantage Plan, and save money monthly, however when you do use it, you will have co-pays, deductibles, and referrals.

Joe DeAngelis – 10/01/2012