Are you entering the Medicare system soon? Your first step is to decide which Medicare part(s) will serve as your base coverage. Even though it may seem overwhelming, you only need to decide between two options: 

1. Original Medicare, which includes Parts A and B
2. Medicare Advantage, known as Part C 

To help you make your decision, let’s break down the differences between original Medicare and Medicare Advantage so you can find the right insurance coverage in retirement.

What are the different letters of Medicare and how do they differ?

If your journey to understanding Medicare begins here, it’ll be helpful to know the Medicare letters or “parts.”

Original Medicare

• Medicare Part A provides coverage of hospital stays and other inpatient services, such as care in nursing facilities or hospice. Like most people, you may have no monthly premium for Part A.
• Medicare Part B provides coverage of physician and outpatient services as well as durable medical equipment and supplies. Part B has a premium.

Medicare Advantage

• Medicare Part C, or Medicare Advantage, provides the benefits of Medicare Parts A and B and may also include dental, vision, and hearing benefits. Depending on your plan, you’ll pay a copay or coinsurance, plus a low or $0 premium every month.

What is the difference between Medicare Part A and B and Medicare Advantage, Part C?

The main difference is original Medicare is the health insurance program available through the federal government. Medicare Advantage plans are available through private insurance companies and are approved by the Center for Medicare and Medicaid Services (CMS). 

According to CMS, 98% of providers accept original Medicare. Medicare Advantage plans have their own networks. While the out-of-pocket limit for Medicare Advantage plans may not exceed $8,850 for in-network services and $13,300 for in-network and out-of-network services combined in 2024. These out-of-pocket maximums apply to Part A and B services only.

Fill gaps with supplemental insurance 

After you reach the yearly out-of-pocket maximum, Medicare Advantage covers the rest of the out-of-pocket costs, but until you reach that limit, it can be pricey. Hospital Indemnity insurance is often an ideal partner for Medicare Advantage because its coverage may fill gaps. Hospital Indemnity riders, especially, can offer comprehensive coverage by providing benefits that help eliminate the cost-share element of Medicare Advantage plans. Since the benefit is paid directly to you, you have flexibility in how you use the funds.

Medicare Supplement insurance — also called Medigap because it helps fill in the gaps of original Medicare coverage — helps you cover potentially expensive out-of-pocket costs, like coinsurance, copayments, and deductibles. Medicare Supplement insurance isn’t owned or operated by the U.S. government, but it's private insurance that must follow rules set by the government and is generally accepted by providers who take Medicare.

For more information about Hospital Indemnity or Medicare Supplement insurance:

• Visit the products page to see what is available in your state
• Call 877-257-2663 to speak to an agent
• Request a personalized, free quote

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