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Medicare Advantage vs. Medigap: Which Should You Pick?

One of the most important decisions you’ll make when signing up for Medicare is whether to supplement your Original Medicare plan with Medicare Advantage or Medigap. You can’t opt for both, so you must choose wisely.

Medicare Advantage and Medigap are both offered by private insurance companies, and each has its advantages. These health insurance plans will either extend your coverage or lower your out-of-pocket costs. To make a sound decision, you must first understand the differences between the two plans:


Medigap is a supplemental health insurance plan. It enhances the coverage provided to you by Parts A, B, and D. Since Medigap uses medical underwriting, you may not get coverage if you have a pre-existing condition and apply outside of the open enrollment period.

That said, in Maine, Massachusetts, Connecticut, and New York, insurance companies cannot deny coverage to seniors due to pre-existing medical conditions.

Medicare Part C, also known as Medicare Advantage, is a United States federal- and state-funded healthcare program that private insurance companies provide. Medicare Advantage plans offer some services that Original (Parts A and B) Medicare doesn’t cover.

Unless you have ESRD (End-Stage Renal Disease), you cannot be denied coverage due to medical underwriting or pre-existing health conditions.

Out Of Pocket Costs, Choice of Doctors & Broader Benefits

Original Medicare offers good basic health coverage, but it only pays about 80% of your medical bills. You pay the remaining 20% in the form of deductibles and other costs. But because Medicare has no out-of-pocket maximum, this 20% could add up to a lot of expenses, especially if you’re someone who has a lot of medical needs.

One of the pros of a Medicare Advantage plan is that it can help you save money in the long term as it has a maximum limit for out-of-pocket costs and offers some drug coverage. At the same time, it may also restrict you to using physicians in the plan’s network.

Medigap policies are designed to cover the many health care costs that Medicare doesn’t. Compared to a Medicare Advantage plan, it also offers you more choice in where you receive your care. People who travel a lot might have difficulty being in-network for medical care, making Original Medicare and a Medigap policy a better choice.

With both options, you save a lot more money than you would with just an Original Medicare plan. Ultimately, your lifestyle, health condition, and finances will determine which is best for you: traditional Medicare plus Medigap or Medicare Advantage.