Medicare Advantage vs. Supplemental

What federal annuitants need to know.

Key Points for Federal Annuitants

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  • Medicare Advantage and Medicare Supplement insurance are options that may sound similar, but they’re quite different.  They do have one main thing in common: they’re both offered by private insurance companies.

  • It is illegal for an insurance company to sell you both a Medicare Advantage and a Supplemental (Medigap) policy.

  • Both require enrollment in Medicare Parts A and B.

  • Federal annuitants may find that they no longer need their FEHBP coverage when they enroll in a Medicare Advantage health plan.  If that is the case, then they may "suspend" their FEHBP coverage and retain re-enrollment rights during a future federal benefits open season.  To learn more about "suspending" FEHB click here.  If you decide to enroll in a Medicare Advantage plan, you will almost assuredly need to enroll in a plan that includes prescription drug coverage.

  • There is no similar "suspension" entitlement if you elect to enroll in a Medicare Supplemental or Medigap plan.

  • For all intents and purposes, when you are retired and enrolled in Medicare Parts A and B, your FEHBP health plan is the secondary payer and acts as your "supplemental" coverage.  This means your FEHB plan generally covers the 20% that's not covered by Medicare.

  • If you "cancel" your FEHBP coverage, chances are really good that you may NEVER be allowed to re-enroll at a later date.  

  • Reenrollment

  • You may voluntarily reenroll in the FEHBP during an annual open season.  OPM will send you an open season package each year with instructions on how to re-enroll.  If you don't want to reenroll, disregard your open season material. If you involuntarily lose your coverage, you can re-enroll in the FEHBP effective the day after your coverage ends.  You must provide evidence of your involuntary loss of coverage.  Your request to reenroll must be received at the Office of Personnel Management (OPM) within the period beginning 31 days before and ending 60 days after your coverage ends. Otherwise, you must wait until the open season to reenroll.