Money & Policy

How to Decode Those Pesky Medicare Ads

Understand your options for filling coverage gaps after 65

(This article appeared previously on MarketWatch.)

You’re on Medicare and being bombarded by insurance ads, since it's Medicare Open Enrollment season through Dec. 7. Let’s make sense of the chaos.

TV. Radio. Your mailbox. Those pesky Medicare ads are everywhere. They're full of vague words like “advantage,” “supplement” and “PDP.” Here's what they mean, and how to get unbiased comparison information:
The first thing to remember is that “Original Medicare” has coverage gaps. There are three options to fill them.
Option 1: Employer plan You might get retiree coverage from your employer or a health plan from a public- or private-sector job. If so, you might not need additional coverage. Contact your benefits office to learn your needs and options.

(MORE: Medicare Open Enrollment: How to Shop Smart)

Option 2: Medigap plus Part D The second pathway is a Medigap policy, usually paired with a Medicare Part D plan. Technically called “Medicare supplement” plans, Medigaps are private policies specifically designed to fill gaps in Medicare coverage. You have a Medigap policy if you show your doctor both your Medicare card and a separate insurance card.
Medigaps are regulated by your state, so rules about switching policies vary. There's no nationwide Open Enrollment period for Medigap, but ads for these policies still cluster around autumn. Ads mentioning Medigap, supplement or Medsupp are talking about Medigap policies.
Your state's Senior Health Insurance Program (SHIP) provides state-specific Medigap information. Find your SHIP at Shiptalk.org. Also check out this guide from Medicare on choosing a Medigap policy.

(MORE: What Medicare Doesn't Cover)

Medigap policies don't cover pharmacy prescriptions, but Medicare Part D plans cover some of those costs. Consider a Part D plan if you have, or plan to get, Medigap coverage.

Since Part D plans do have annual Open Enrollment through Dec. 7 (it's why advertising is spiking for them now), you can enroll in one or switch yours until then. Ads with words like prescription, drug, medicine, and PDP (prescription drug plan) are talking about Medicare Part D.

Option 3: Medicare Advantage plan You might have a Medicare Advantage plan, also called Medicare Part C or Medicare Health Plan.
These types of plans are comprehensive policies that replace all your Medicare coverage with private insurance. You have an Advantage plan if you're on Medicare but you show your doctor a private insurance card, not your Medicare card. Many Advantage plans include Part D prescription coverage, so all your health coverage is in one policy, similar to employer plans.

(MORE: Common Questions and Answers About Medicare)

Advantage plans have Open Enrollment through Dec. 7 — the same as Part D plans — to enroll or to switch plans. Words like Advantage, Part C, all-in-one, or comprehensive indicate that the ad concerns Advantage plans.
Learn more these plans from your SHIP or at the Medicare site, Medicare.gov.
Watch the Fine Print
Every Medicare plan requires both Medicare Parts A and B; you pay for Part B in addition to any premiums for your other coverage.
Now those ads are less baffling. Shop carefully, and as always, keep on planning.

Andy Landis, founder of Thinking Retirement, is an author, speaker, and consultant specializing in Social Security, Medicare, and life planning for retirement. His books include Social Security, The Inside Story and When I Retire. He can be contacted through his website, andylandis.biz.

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