Medicare Choices for Seniors

A high-level overview of the two Medicare options available for Seniors and a comparison of its cost and benefits.

Seniors who are 65 or older can choose between the two Medicare options: Original Medicare and Medicare Advantage. Original Medicare is administered by the Federal Government. It includes several parts. Part A, B and D cover hospital, doctor office visits and drugs. Medigap plans cover out-of-pocket expenses such as copays, coinsurance and deductible from Part A, B and D. Plan F is the most comprehensive of the Medigap plans. It could even provide some international coverage. All parts, except Part A, carry a premium which adds up to about $335 a month. Original Medicare is widely accepted by many providers and works well with employer benefit plans.

The Medicare Advantage is offered by private insurance companies and operate similar to a regular PPO/HMO plan. The hospital and doctor office visits are still covered by Part A and B. But, drugs and additional benefits such as Dental, Vision and Hearing are covered by Part C. The out-of-pocket expenses vary widely between insurers. The total monthly premium for a middle-of-the-line plan is around $285.

Neither Medicare options, however, cover Long-Term Care (LTC) beyond skilled nursing care for up to 100 days. With increasing life expectancy, 7 out of 10 seniors are prone to LTC disability. The costs of providing LTC can be burdensome. We have summarized them in our blog “LTC Facts and Economics.” However, insurance policies provide tax-free LTC benefits either as a standalone policy or as a rider attached to an Indexed Universal Life (IUL) policy. The coverage details of an LTC policy are provided in our blog “LTC Policy Design Considerations.”

The Medicare enrollment timeline is strictly enforced and carries big penalties if not followed. Seniors have 7 months (A65 birth month ±3 months) to select between the two Medicare options and to avoid penalties. “Medicare & You” is a comprehensive handbook that the Government publishes every year to provide a detailed explanation of the program and its current benefits.

We specialize in tax-free retirement strategy and investments such as IUL, Annuity and LTC. Prefer a quick and complimentary consultation? Just email us at

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