The Core Difference: How Each Plan Works

Medigap and Medicare Advantage are two entirely different ways to pay for healthcare once you have Original Medicare. They are not upgrades to Medicare — they are separate insurance products that work alongside or instead of it.

With Medigap, you keep Original Medicare (Parts A and B). Medigap is a supplemental policy sold by private insurers that pays some of the costs Medicare does not cover: copayments, coinsurance, and deductibles. Medicare processes your claim first, then Medigap pays its share. You can see any doctor or hospital that accepts Medicare.

With Medicare Advantage, you replace Original Medicare entirely with a private insurance plan (usually an HMO or PPO). Medicare Advantage includes hospital, medical, and usually prescription drug coverage all in one plan. You pay a monthly premium to the insurance company, not to Medicare. In exchange, you must use doctors and hospitals in the plan's network, and you typically need a referral to see a specialist.

Key Takeaways

  • Medigap supplements Original Medicare and lets you see any Medicare-accepting doctor; Medicare Advantage replaces Original Medicare and limits you to in-network providers.
  • Medigap has no annual out-of-pocket maximum, so costs can be unpredictable; Medicare Advantage has a yearly cap on what you pay out of pocket.
  • Medigap plans are standardized by the federal government (Plan A, Plan B, Plan G, etc.) so the same plan name covers the same benefits everywhere; Medicare Advantage plans vary by insurer and region.
  • Medigap premiums are usually higher but more stable; Medicare Advantage premiums are often lower or zero but may increase yearly and include network restrictions.
  • You can switch between Medigap plans during open enrollment or if you lose employer coverage, but switching to Medicare Advantage from Medigap can be harder if you have health issues.

How Costs Work: Premiums, Deductibles, and Out-of-Pocket Limits

Medigap costs vary by plan letter and insurer, but once you choose a plan, the premium is usually predictable month to month. You still pay the Original Medicare Part B premium to Medicare, then a separate Medigap premium to the private insurer. The advantage is that Medigap covers most or all of your copayments and coinsurance — some plans cover the Part B deductible entirely. The disadvantage is there is no annual out-of-pocket maximum, so if you have many medical visits, your costs can add up.

Medicare Advantage premiums are often lower than Medigap (sometimes zero), but you pay copayments or coinsurance when you use services. Medicare Advantage has an annual out-of-pocket maximum — once you reach it, the plan pays 100 percent of covered services for the rest of the year. This protects you from catastrophic costs. However, if you rarely see a doctor, you may pay more in premiums than you would with Medigap.

Both plan types include prescription drug coverage, but they handle it differently. Medigap does not cover drugs — you buy a separate Part D plan. Medicare Advantage usually includes drug coverage in the plan itself, though you may have higher copayments for certain medications.

Network Restrictions and Doctor Choice

With Medigap, you can see any doctor or hospital in the United States that accepts Medicare. There is no network, no referral requirement, and no prior authorization for most services. This flexibility is the main reason people choose Medigap, especially if they have established relationships with specific doctors or specialists.

Medicare Advantage plans have networks. An HMO network is usually smaller and requires you to choose a primary care doctor who coordinates your care and refers you to specialists. A PPO network is larger and may let you see specialists without a referral, but you pay more if you go out of network. Some Medicare Advantage plans cover emergency care out of network, but routine care out of network is your responsibility. If you travel frequently or live part of the year in another state, network restrictions can be a real problem.

Standardized Plans vs. Plan Variation

Medigap plans are standardized by federal law. Plan G covers the same benefits in Florida as it does in California — the insurer cannot change what is included. There are ten standardized Medigap plans (A, B, D, G, K, L, M, N, and two high-deductible versions). This makes it straightforward to compare: you can call three insurers, get quotes for Plan G, and know you are comparing the exact same coverage.

Medicare Advantage plans are not standardized. Each insurer designs its own plan, sets its own network, and chooses which hospitals and doctors to include. Two plans with the same name from different insurers can cover different things. This means you have to read the details of each plan you are considering, and plans change every year. The plan you had in 2024 may not exist in 2025, or it may have a different network or premium.

When You Can Switch and What It Costs

You can change Medigap plans during the annual open enrollment period (October 15 to December 7) or if you lose employer coverage. Some states allow switching at other times. When you switch Medigap plans, the new insurer cannot deny you or charge you more based on health conditions — this is called may provide issue. You can switch as many times as you want.

Switching from Medicare Advantage to Medigap is also possible during open enrollment, but the new Medigap insurer can charge you more or deny you if you have health problems — may provide issue does not explore. This is why people who think they might want Medigap later often choose it from the start. Switching from Medigap to Medicare Advantage is easier: you can do it any time during open enrollment, and Medicare Advantage plans cannot deny you based on health.

Which Plan Type Covers Travel and Specialty Care

If you travel outside the United States, neither Medigap nor Medicare Advantage covers routine care abroad. However, some Medigap plans cover emergency care during travel outside the U.S. — Plan C and Plan G, for example, cover 80 percent of emergency care costs. Medicare Advantage does not cover care outside the U.S. at all, except emergency care in Canada or Mexico for people who live near the border.

For specialty care within the U.S., Medigap is simpler: you can see any specialist without a referral. Medicare Advantage requires a referral from your primary care doctor (in an HMO) or may charge you more if you see a specialist out of network (in a PPO). If you see many specialists or have a complex medical history, this can make Medigap more convenient, though it may cost more in premiums.

Frequently Asked Questions

Can I have both Medigap and Medicare Advantage at the same time?

No. You choose one or the other. If you have Medicare Advantage and buy a Medigap policy, Medicare will not pay the Medigap insurer, and the Medigap policy will not work. You must drop one before enrolling in the other.

Which plan is cheaper overall?

It depends on your health and how often you see doctors. Medicare Advantage premiums are usually lower, but if you have many medical visits or use specialists, your copayments can add up. Medigap premiums are higher, but you know your costs upfront. Run the numbers for your situation: add up the annual premium plus your expected copayments for each plan.

What happens to my Medigap plan if I move to a different state?

Your Medigap plan follows you. The same Plan G works in any state. However, the insurer may not operate in your new state, so you may need to switch to a different insurer offering the same plan. You have may provide issue rights when you move, so the new insurer cannot deny you or charge more based on health.

Do I need a referral to see a specialist with Medigap?

No. With Medigap and Original Medicare, you do not need a referral to see any specialist. You can call and make an appointment directly with any doctor who accepts Medicare.

Can my Medicare Advantage plan drop me or change my network mid-year?

Plans cannot drop you mid-year, but they can change their network. If your doctor leaves the network, you may be able to continue seeing them for a limited time, but you should contact your plan when ready. This is one reason to review your plan's network every year during open enrollment.