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Is a Medicare Advantage plan or a Medicare supplement plan a better financial decision?

State Health Insurance Assistance Program (or SHIP) councilors are available at 1-888-696-7213 to help you sort it all out

Its that time of year again - the Medicare enrollment period is underway.

Medicare recipients can choose between a Medicare Advantage plan and a Medicare supplement plan, also known as Medigap, to cover their insurance needs.

The two options are currently almost evenly split in use among Medicare recipients across the country.

Older Americans are often looking for advice on which plan might be best for them.

The State Health Insurance Assistance Program in Colorado is the best place for impartial, reliable information from their many experts. One of those experts is Lauren Bell at the Denver Regional Council of Governments (DRCOG), who helped us sort out the details in the two primary vehicles that help to deliver your coverage.

Medicare Advantage plans are popular because of their low or zero monthly premiums. Some even have dental and eye care. However, these plans have maximum yearly out-of-pocket costs, sometimes as much as $10,000.

"They can go up to $10,000," said Bell. "The lowest is actually $3,400. So usually when you pay those higher premiums with an Advantage plan, you'll get those lower maximum out-of-pockets."

Bell said it's also important to remember that if you get sicker as you get older, you more than likely won't be able to move from an Advantage plan to a supplement to lower you medical out-of-pocket costs. So beginning your coverage with a Medicare supplement plan might be your best bet.

"Sometimes we talk to folks who already have a diagnosis or a disability that they know that premium pays for itself because of the co-pays it will help cover with hospital visits, with X-rays, surgeries you name it," Bell said.

Medicare supplements have monthly premiums that begin low, as little as $77 a month, and increase every year as you age. But because you're paying a monthly premium, with many supplement plans, you would rarely see a medical bill.

"That's true," Bell said. "You could get one that covers all of your co-pays after Medicare pays for your hospital or medical costs."

Supplements generally have low deductibles, no out of pocket maximums and low or no co-pays.

It's not easy homework. There are ten letter plans to choose from offering different coverages for certain hospital costs, skilled nursing and coverage for illnesses when you travel. The best rule of thumb for both supplements and advantage plans is to have a little skin in the game.

"That's a good way to put it, says Lauren Bell. "If you put our more for your premiums, you tend to get lower cost for your co-pays. That kind of goes for the Advantage plans and the supplements. You will tend to see the cost reduced."

No matter what plan you select, you must review and compare prescription drug coverage. There have been significant changes in prescription drug plans this year. Not shopping them can cost you hundreds of dollars, and there are pages and pages of those to select from as well.

It is a lot to consider. But there is help to get solid advice on what plans will help you the most and cost you the least."State Health Insurance Assistance Program (or SHIP) councilors are available at 1-888-696-7213 to help you sort it all out.

They seem to agree that the more you pay monthly, the more you reduce your out of pocket costs for both the Advantage and the Medigap supplements.

"We always say with insurance/Medicare the answer is often “it depends." I always make sure people are reading the plan closely and are understanding what they’re getting and what they are paying for," added Bell. "Some folks can’t always afford the premium of a Medigap supplement or a higher priced Advantage plan."

She said the SHIP staff can help counsel people whose decision would be impacted by their financial situation, their doctors, their lifestyle, and personal preferences.