UNITED STATES—Dear Toni: What is the difference between a “Medicare Supplement” and a “Medicare Advantage PPO” plan? I am turning 65 and I am being bombarded with marketing material.

Friends have told me that a Medicare Advantage PPO plan is the same as a Medicare Supplement because both have a network of doctors to pick from. My retiree employer medical plan now has a Medicare Advantage PPO plan, and I am concerned if a medical catastrophic incident happens will the medical providers, I am now seeing accept this Medicare Advantage

PPO plan? Thanks, Stephen from Denver, CO.

Stephen: Your friends have given you WRONG information regarding Medicare. This can lead you to choose the wrong Medicare plan for your medical situation. Medicare Supplements and Medicare Advantage Plans are completely different types of Medicare policies.

With a Medicare Supplement, there is not a network of any kind; you have the freedom to use any healthcare provider/facility that will bill Medicare. The Medicare Supplement will pay for your Medicare out of pocket that Medicare Parts A and B will not pay.

With a Medicare Advantage PPO plan, there are lower cost in-network providers/facilities as well as out of network benefits that will cost you more. In 2022, a popular Medicare Advantage PPO plan has a maximum ranging from $5,400 to $7,550 in-network while out of network costs range from$7,550 to $11,300.

Most never consider they could have an out of network provider/facility for their medical claim, but in these current times many healthcare providers/facilities are out of network with a Medicare Advantage PPO plan.

Below are differences in the two plans:

  • Medicare Supplement:
  • A Medicare Supplement works directly with “Original Medicare.” Medicare pays its share of the Medicare-approved amount for “medically necessary “covered healthcare costs.
  • Your Medicare supplement will pay its share. With a Medicare Supplement, you chose which doctor, hospital, home health agency, skilled nursing facility, etc. that accepts Medicare assignment for your healthcare. You and your healthcare providers are in control of your healthcare.
  • The downside to a Medicare Supplement is that you have a monthly premium that may increase the premium rate each year.
  • Medicare prescription (Part D) drugs plans are not included, so you may want to enroll and will pay separately for a “Stand alone” Medicare (Part D) Prescription drug plan.
  • Medicare Advantage PPO Plan: 
  • To qualify for any Medicare Advantage plan:  a) You must be enrolled in both Medicare Parts A & B. b) Live in the service area 6 months out of a year.
  • When you choose a Medicare Advantage Plan, Medicare pays the insurance company a certain dollar amount every month for your care for the plan you are enrolled. Your Part A and Part B must always remain in effect.
  • When you go to the doctor, hospital or visit your pharmacist, you must only use your Medicare Advantage Plan insurance card, not your Medicare (red, white, and blue) card. Verify that your specific medical provider is still accepting the MAPD plan that is being enrolled in.
  • A Medicare Advantage Plan must provide all your Part A and Part B benefits and some Medicare Advantage Plans have Part D prescription drug plans included. Also, has “extra” benefits such as gym membership, dental and vision.

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