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What is Medicare Advantage PPO vs Medicare Supplement (Medigap) Plans?

You might think a Medicare Advantage PPO plan is the same as a Medicare Supplement Plan.  There are similarities, but there are a lot more differences than you'd think.  Let's look at the differences to determine whether you are more suited for a Medicare Advantage PPO vs a Medicare Supplement Plan.

Medicare Advantage PPO vs Medicare SupplementIn-Network vs Out-of-Network

With a Medigap plan, you won't have to worry about higher costs if the doctor is out-of-network.  Medigap plans don't have networks but Medicare Advantage PPO plans do.  With a Medigap plan, Medicare will pay its portion and the Medigap plan will pay its portion.  If you've purchased a Medigap Plan other than Plan F, you'll pay your portion.  As long as the doctor accepts Original Medicare, he or she must accept your Medigap plan regardless of which insurance company offered it to you.

With a MA PPO plan, your out-of-network doctor isn't obligated to accept the plan.  The out of network doctor can refuse to accept the plan, and then you'd either have to go to a different doctor or else pay 100% of the cost to see the out-of-network doctor on the PPO plan.

With Medicare Advantage PPO plans, you'll pay less when you see an in-network provider.  With Medicare Supplement Plans there are no networks.  You'll be able to see any doctor who accepts Medicare, anywhere in the United States.

Also, even if your doctor is in-network or accepts the plan when you first enroll, he or she can leave the plan later that year.  If that happens, you're out of luck.  You won't be able to change plans until the AEP (Annual Election Period) and your doctor might not accept any Medicare Advantage Plans at all.

Losing your doctor isn't a valid reason to get a guaranteed issue on a Medicare Supplement plan, or to get a special election period to have the chance to in one mid-year.

Medicare Prior AuthorizationPrior Authorization in Medicare Advantage PPO vs Medicare Supplement

Although you can technically see any out-of-network doctor with a Medicare Advantage PPO plan, you might not be able to get the procedure or service you want.

On a Medicare Advantage PPO, you can be subject to pre-authorization.  This means that there is someone other than your doctor deciding whether you can get a procedure.  This does not happen on a Medicare Supplement (Medigap) Plan.  As long as your doctor thinks you need a Medicare-approved service, you'll be able to get that service under original Medicare and your Medigap plan.

Claims in Medicare Advantage PPO vs MedigapClaims in Medicare Advantage PPO vs Medigap

A Medicare Advantage PPO Plan could deny your claim.  With original Medicare and a Medicare Supplement Plan, there is no arguing with the insurance company.  If Medicare pays its portion, the Medicare Supplement Plan MUST also pay its portion.  If Medicare says it won't pay for your service, then your Medigap plan won't cover it either.  It's that simple.

Renewability in Medigap vs Medicare Advantage PPORenewability in Medigap vs Medicare Advantage PPO

Medicare Advantage PPO plans can change every year.  If they increase the co-pays, premiums, or change their terms to something you don't like, you don't have any recourse except to change plans.  Although Medicare Supplement Plans automatically renew each year, (they don't change their terms), if you don't get one when you are healthy, or within 6 months of your Part B effective date, you might not qualify for one.

Medigap plans can discriminate against you if you have health issues Even if they accept you into their plan, you might have a six-month waiting period for the insurance company to cover pre-existing conditions.

Some states, such as California, have different rules on this, but most states don't give you the opportunity to change plans if you have pre-existing medical conditions.

Keep in mind that the Medigap insurance company can, however, increase your premium.

However, if the insurance company drops the plan, you'll be able to get a Medigap plan using the Guaranteed Issue rules.  Good luck finding an agent or broker to assist you with this change though, because most insurance companies won't pay an agent or broker for using these rules to help you enroll.  Most brokers and agents don't want to take on the liability of helping you if they aren't getting paid.  And they cannot accept a fee from you to assist you with the change.

Drug Coverage in Medigap vs Medicare Advantage PPODrug Coverage in Medigap vs Medicare Advantage PPO

If you are on a Medicare Advantage PPO, you cannot purchase a stand-alone drug plan.  What that means is that if the PPO that works best for your medical needs for you doesn't have the drug coverage you'd like, you are out of luck.

If the plan you want doesn't offer prescription coverage, you are out of luck.

Even if you don't take any medications, you'll need either a drug plan or creditable coverage to avoid future penalties.  With a Medicare Supplement plan, you can purchase the drug plan that saves you the most money.  But it will be at an added expense.  Here's how to find the prescription drug plan that saves you the most money.

Part B Medications in Medicare Advantage PPO vs Medicare SupplementPart B Medications in Medicare Advantage PPO vs Medicare Supplement

Medicare Advantage PPOs handle Part B medications differently than original Medicare and a Medicare Supplement Plan.

For example, if you are diabetic and use a pump, Medicare and Plan F covers your insulin at 100%.  With Medicare Advantage PPOs, you could have a co-pay ranging up to 20 – 50% of the cost of the drug.

The same thing applies to chemotherapy drugs and other doctor provided shots such as Lupron.  The Medicare Advantage PPO could require you to pay a co-insurance amount (which can be a lot of money!) where-as with a Medigap Plan you could have a smaller amount to pay.

Durable Medical Equipment in Medicare Supplement vs Medicare Advantage PPODurable Medical Equipment in Medicare Supplement vs Medicare Advantage PPO

Medicare Advantage PPOs can handle Durable Medical Equipment (DME) differently than Medicare with a Medigap Plan.  Similar to how MAPDs treat Part B drugs, they can charge you a co-insurance amount, which could wind up costing you a lot more than it would on a Medicare Supplement Plan.

Medical Conditions in Medigap vs Medicare Advantage PPOMedical Conditions in Medigap vs Medicare Advantage PPO

The good news about Medicare Advantage PPOs is that they MUST accept you into their plan as long as you:

  • Have Medicare Parts A and B and pay your Part B premiums.
  • Don't have End-Stage Renal Disease (if you get ESRD while you have an MAPD or Medicare Supplement Plan they can't kick you off the plan because of that).
  • Live in the coverage area.
  • Pay your MAPD premiums, if any.

If you don't get a Medicare Supplement plan during your one-time open enrollment (typically at age 65) or during a Guaranteed Issue period (typically because your plan ended or you moved out of the coverage area), then the insurance company can refuse to cover you.

Hospitals in Medicare Advantage PPO vs Medicare SupplementHospitals in Medicare Advantage PPO vs Medicare Supplement

Almost every hospital in the United States accepts Medicare. There are a few that don't, such as VA hospitals, but you can easily find out by using the hospital compare search.

If you have a Medicare Supplement Plan, you can go to almost any hospital.  If you are on a Medicare Advantage PPO, you must determine which hospital is in-network to avoid out-of-network charges.  The nearest or best hospital might not be in-network.  There is no need to worry about this if you are on original Medicare with a Medicare Supplement plan.

How to tell if it's a Medicare Advantage PPO vs a Medicare Supplement (Medigap)

What it's called:

Medicare Advantage PPOs will use the term “Medicare Advantage”.  Medicare Supplement Plans will normally be called, “Plan” and show the letter, such as Plan F, Plan G, Plan N, etc.

Also, Medicare Supplement Plans cannot offer prescription drug coverage.  Medicare Advantage Plans can offer drug coverage or they might not, depending on the plan.

Medicare Advantage PPOs will have a network.  Medigap plans won't.

Medicare Advantage PremiumsPremiums

With a Medicare Advantage PPO, you could have a zero premium.  The plan could also pay towards your Part B premium.  This is never true with a Medicare Supplement Plan.  You'll always have a premium to pay with Medicare Supplement (Medigap) plans.

Enrollment periods

You can only change your Medicare Advantage PPO plan during the AEP (October 15 through December 7) or during a Special Election Period.  Not true with a Medicare Supplement Plan.  You can make changes any time during the year as long as you can qualify medically.  If you can't qualify medically and don't have a Guaranteed Issue period, you won't be able to make changes during any time of year.

Some states have guaranteed issue laws around certain events.  Be sure to ask us about your state rules.

Image of Star ratings. Doctors will be subject to Star Ratings under Medicare's MACRA rules.Rating systems

Medicare Advantage PPOs use the Star Rating System.  You can look at these ratings to see how Medicare and other PPO members rate the plan.  One star is well below average and five stars are well above average.  We recommend that you always look at that average overall rating along with each section of the customer service ratings you care about.

Medicare Supplement Plans aren't rating by the star rating system.  AM Best and S&P rate the insurance companies based on their financial strength.

Travel Benefits

If your plan offers “travel benefits” that allow you to see doctors out of your area when you are traveling, it is a Medicare Advantage Plan.  Medigap plans don't need travel benefits because there are no networks.


These plans are regional or local.  Their networks are smaller, so if you go out of your area, you will probably have higher copays or coinsurance amounts because you are out-of-network.

Extra Benefits

If you have any of the following benefits, you are likely on a PPO.  Medicare does not cover these benefits, so if your plan covers these (as part of the plan, not as part of an add-on service), then you likely have a Medicare Advantage Plan, not a Medicare Supplement Insurance Plan:

  • Hearing exams and hearing aids
  • Dental benefits such as exams, cleanings, and fillings
  • Vision Services
    • Routine eye exams
    • Contacts and glasses
  • Skilled Nursing without a three-day hospital stay
  • Transportation
  • Post-hospital Meals
  • 24-hour nurse lines
  • Acupuncture
  • Annual Physical Exam vs “Wellness Exam”
  • Gym Memberships (but Supplement Plans can offer this too as ancillary benefits)
  • Over-the-counter medicines
  • Personal Emergency Response System (PERS)
  • Tele-doctors and tele-counselors

Image of cartoon character with red phone inviting the reader to call or email MedicareQuick with questionsI know that Medicare Advantage PPO vs Medicare Supplement Plans can be confusing.  If you would like further clarification, please contact us at (866) 445-6683 or use our contact form to email us.


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