A Medicare beneficiary who decides to apply for a Medicare Advantage Plan may wonder why the insurance policy costs more than traditional Medicare coverage. The reason is simple. A Medicare Advantage Plan offers more coverage than just typical Medicare and the premiums are adjusted to account for the additional expenses and a small amount of money gets added on to allow the insurance companies to turn a profit. When shopping for an Advantage Plan, you should compare the price to a Medicare and Medigap policy combined rather than to just the premium Medicare offers.
A Medigap policy is designed to fill holes in standard Medicare policies. It does not have all the restrictions of benefits that a Medicare Advantage Plan might. A person with a Medigap plan has to worry less about a network of Doctors, although he does have to inform his doctor of both policies. A Medicare Advantage Plan is really two policies when bought. A subscriber receives all the benefits he would from Medicare and additional benefits that cover the area that a Medigap policy would normally cover. When shopping around for new insurance, it is important to get quotes from the HMOs that offer Advantage plans and from Medigap companies.
Medicare Advantage Plans are often a better deal than a Medicare and Medigap policy, but the reader should not think that this statement is universally true. A wise consumer always shops around and compares to get what his best deal is. The wisest of insurance shoppers checks the levels of coverage he receives and compares them to the cost of receiving the services. Buying a Medicare Advantage plan is no different than buying any other product in this regard.