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I have a Medicare Advantage plan that lets me go to any doctor. I pay a modest MA premium on top of the regular Medicare premium that is deducted from Social Security. I saw a host of different MA and Supplement plans, so anyone who is thinking about this should really dig into each plan’s coverage and costs – they are not all the same. (Because of the low MA premiums, I never really considered traditional Medicare alone. At the same time, I ignored the MA plans that promise to “give back” or cover meals and the like. (Dyno-Mite!)) I am in very good health, but have had some unusual procedures since I’ve retired – lots of Mohs surgeries and some prostate stuff, all at no cost beyond the smallish co-pays I have for every doctor visit. I passed on Supplements initially because the Supplement premiums were quite high and I couldn’t see where the benefit could ever offset the cost for me. I am happy with my MA plan (which is offered by a Johns Hopkins-related unit.) However, the comments here about Supplements and Medi-Gap will keep me attentive to my other options each year. Thanks for everyone’s inputs.
Retiring as a single female at 70 to a life plan community (a.k.a. CCRC: continuing-care retirement community), I aimed to simplify and avoid unexpected costs. I chose Medicare plus Medigap for the reasons Rick Moberg and Andrew Forsythe listed. For my Medigap Plan G (at Mutual of Omaha), the premium is the same every month (about $150/mo in 2022). I set it to autopay from my bank account. My Plan G has an annual deductible set by Medicare (which my CCRC pays), and beyond that I incur $0 out-of-pocket costs. For example, in 2022 I had a total hip replacement and knew all the associated costs would be completely covered. The bills up to the Plan G deductible went to my CCRC, and all bills after that went directly to Medicare and Medigap — simplicity and security.
Edits: (1) The Plan G premium is about $130/mo in 2022. (2) And of course there’s the Part B monthly premium set by Medicare, taken out of my Social Security benefit.
The goal I have above all in retirement is flexibility and resilience. We should have a strong enough balance sheet when I stop working to afford traditional Medicare + medigap with a high-deductible gap plan. For many of the reasons Rick Moberg mentioned, this should be optimal for us.
I think the lower upfront premium costs and expanded benefits of Medicare Advantage plans are great as long as you never get seriously sick or injured. Inasmuch as that’s unlikely as we age, I like traditional Medicare with a Medicare Supplement plan for the following reasons:
First, your out-of-pocket expenses with an Advantage plan could be significant if you get sick or injured. Your exposure to out-of-pocket expenses is much lower with a Supplement plan.
Second, there are no networks or referrals with a Supplement plan. You can go to any hospital or doctor that accepts Medicare. You are covered if you wish to seek treatment in other states that have hospitals and specialists you might need.
Third, Medicare Supplement claims are processed by the Centers for Medicare Services and not your insurance company. Once CMS covers a claim, your supplement insurance company must pay the unpaid balance regardless of whether they would have approved the claim for their Advantage plan holders.
Fourth, Medicare Advantage plans expose you to underwriting risk. If you start with an Advantage plan and then get very sick and want to switch to a Medicare Supplement plan, your insurance company may require medical underwriting. If so, the insurer will look at your medical history and current health status. If it determines the risk of covering you is too great, it can refuse to sell you a plan or it may charge you much higher premiums. In fairness, this is less of a problem if you live in MA, CT, NY or ME.
Lastly, Medicare Supplement plans are portable. You can take them to another state if you move and like your plan.
I’m learning about Medicare complexities in prep for when I reach 65. You say MA is great as long as you never have a serious condition. Is it true that MA sets an out-of-pocket maximum but traditional Medicare and Medigap does not? If so, wouldn’t MA be better to cover catastrophic?
I’ve been happy with my Medicare Supplement: no referrals, choice of any Dr. who accepts Medicare rather than being locked into a network, no pre-approvals, etc. The hassles are really minimal. I just signed up my wife for a similar plan. And if we have more medical problems down the road, I think we’ll be even more glad we went with the Supplements.