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Medicare Supplement vs Medicare Advantage plans in North Carolina
Which should you choose?

Man pondering insurance choice.


If you live in North Carolina, and you have your original Medicare coverage in place, you will have a choice of options for improving your coverage.  You may combine your Original Medicare plan with a Medicare Supplement plan, or you can sign up for a Medicare Advantage plan.  Two out of three people in North Carolina choose the Medicare Supplement option, one third choose the Medicare Advantage option.  The Medicare Advantage option is growing in popularity.  So, which option is right for you? A brief explanation of the workings of both options may help.

Good to know:  If your family is healthy and doesn't visit the doctor often, a high-deductible health plan could save you hundreds of dollars in lower monthly premiums.  In addition, most high deductible health insurance plans are HSA eligible.  An HSA eligible plan qualifies you to open a health savings account (HSA).  A health savings account is designed to work in concert with a your high deductible health insurance plan.  You can save money in your HSA account before taxes and use the funds to pay for eligible health care expenses.  Additionally, unused HSA funds continue to grow tax-deferred, year after year.
How A Medicare Supplement Plan Works
A Medicare Supplement plan is designed to fill in the "gaps" in your Original Medicare coverage. Medicare supplement plans don't work like most health insurance plans.  They don't actually cover any health benefits.  Instead, if you incur a medical bill, these plans cover the portion of the bill that Medicare does not cover.  These costs can include:
  • Your Medicare deductibles.
  • Your coinsurance.
  • Hospital costs if your stay runs beyond the Medicare covered hospital days limitations.
  • Skilled nursing facility costs if your stay runs beyond the Medicare covered skilled nursing facility limitations.

    • Here's how Medicare supplement plans in North Carolina work: You pay a monthly premium for your Medicare supplement plan.  In return, the plan pays most of your out-of-pocket expenses.  How much the plan pays, depends upon the plan type you select.  For example, if you go to see a physician, Medicare will only pay 80% of the bill.  You are responsible for paying the remaining 20%.  However, you are covered by a Medicare supplement plan, the supplement plan would pay the 20%.  You would owe nothing.

      There are 10 standardized plans available – labeled A, B, C, D, F, G, K, L, M and N – that cover anywhere from four to nine of these benefits:

      • Medicare Part A coinsurance for hospital costs (up to an additional 365 days after Medicare benefits are used).
      • Medicare Part B coinsurance, copayment.
      • First three pints of blood for a medical procedure.
      • Part A hospice care coinsurance or copayment.
      • Skilled nursing facility care coinsurance.
      • Part A deductible.
      • Part B deductible.
      • Part B excess charges.
      • Foreign travel emergencies.


      Keep in mind, all 10 Medicare supplement plans cover the coinsurance and 100 percent of hospital costs for Medicare Part A, but after that, plans differ in what they cover. With Original Medicare, you are free to see any doctor who accepts Medicare patients, with no referrals required.


      Good to know:  You shouldn't promptly pay medical bills.  Yes, you read that right.  The reason is, healthcare providers tend to send bills well before the insurance company has decided what part of the claim they are obligated to pay.  The average person sees a bill and thinks they are obligated to pay it.  This couldn't be further from the truth.  Health care companies routinely shoots out bills to everyone one involved - regardless of who is actually responsible for paying it.  You need to know what the insurer is going to pay before you do anything.  Our advice? Don't pay a dime until you get an EOB (Explanation of Benefits) from your insurer that explains your claim and how much they are paying.
      How Medicare Advantage plans work in North Carolina

      Medicare Advantage plans (also known as Medicare Part C) combine doctor, hospital and often drug coverage into one plan.  Some may cover routine dental, vision and hearing needs, and may offer other services. Most Advantage plans offer prescription drug coverage.

      Medicare Advantage plans are offered by private health insurance companies.  These insurance companies provide consumers with Advantage plan coverage. In turn, rather than Medicare paying a physician or hospital for services provided, Medicare pays an ongoing, predetermined amount to the insurance company for providing the Advantage plan coverage.

      Medicare Advantage plans usually have copays and deductibles, but many limit the total amount you will have to pay for medical expenses out of pocket each year. Medicare Advantage plans work like the managed care plans you may have had during your working years.  You will have to receive your care from doctors, hospitals, and other providers within the plan's network. Plans can be health maintenance organization (HMO), or preferred provider organization (PPO).  If you have an HMO, you can only visit doctors and hospitals in those networks.  PPO plans have out-of-network benefits as well.  Visits to a specialist often require referrals, and some types of care may require advance approval.  There are several distinct physician / hospital networks in the North Carolina region.  If you have a doctor or facility preference, be sure to confirm their participation in the plan's associated network - before you purchase the plan.

      Whichever option you choose, it is an important choice.  Be sure to speak directly with a Medicare insurance professional before you make your decision.

      Good to know:  High-deductible plans come at a cost: You'll pay less each month in terms of premiums, but if you do have to use any medical services, you'll pay out of pocket for longer thanks to that high deductible.  Still, if you're looking to lower your monthly costs and you're someone who doesn't frequent the doctor often, high-deductible plans are a valid option.



      Other articles:  Is Short-Term Health Insurance Right For You?
      Explaining The Growth Of Healthcare Sharing Plans.
      Finding Short-Term Health Insurance.
      Resources



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