In this article, we will go over the difference between traditional Medicare and Medicare Advantage. We will also cover what Medicaid is and who qualifies. Understanding the differences between these insurance plans will help you navigate your benefits with confidence and ease.
What is Medicare?
"Traditional" or "fee-for-service" Medicare is provided directly by the government to recipients. Other terms you may hear are “Direct”, “Original”, “Straight” Medicare, or “Medicare Part B” in reference to non-hospital doctor visits and outpatient care (like the ones you access through Rula). With Traditional Medicare, patients can go to any doctor who accepts Medicare. As it's a federally run program, benefits are standardized nationally.
Just like Medicare Advantage, this coverage is for those who are 65 or older as well as younger people with certain disabilities.
It is worth noting that over 80% of individuals with Traditional Medicare also have some type of secondary insurance (like Medigap, employer or retiree coverage, Medicaid, or other).
What is Medicare Advantage?
Medicare Advantage is government-funded but managed by private insurance companies – the primary difference to traditional Medicare. These plans have to offer the same coverage as Traditional Medicare plans, but are allowed to offer additional benefits – so benefits coverage may vary by plan. These plans can also have higher premium costs due to the additional benefits offered. With Medicare Advantage, patients may have to use doctors in their network, without the need for a network or referral. Another term you may hear in reference to Medicare Advantage is Medicare Part C.
Just like Traditional Medicare, this coverage is for those who are 65 or older as well as younger people with certain disabilities.
| The Plan Type | "Traditional" Medicare | Medicare Advantage |
| Who is it for? | Elderly (65yr +) & some younger people w/ disabilities | |
| Who offers it? | Provided directly by the federal government | Offered by private companies approved by Medicare |
| Medical coverage for patients | Standardized nationally: Medicare Part A + B (Hospital & Outpatient Care) |
Varies by plan, generally: Medicare Part C (includes most of Part A and B) + Part D (Drugs & Prescriptions) |
| Who bills? | The federal government (Centers for Medicare & Medicaid Services i.e CMS) | The private payer |
Do I have Traditional Medicare or Medicare Advantage? How do I choose the right plan with Rula?
If you have Traditional Medicare, you’ll have a red, white, and blue Medicare card issued by the federal government that says “Medicare Health Insurance” at the top. Below is an example.
If you have a Medicare Advantage Plan, you’ll have a private insurance card from the insurance company, not the red-white-blue card shown above. Going to Medicare.gov or calling 1-800-MEDICARE (1-800-633-4227) will also help you clarify your current coverage and tell you what kind of plan you’re enrolled in.
Whenever you're asked to indicate your insurance at Rula, please select:
- If you have a Medicare Advantage plan, select "private insurance company name - Medicare Advantage" (for example: " Aetna - Medicare Advantage").
- If you have Traditional Medicare, select "Medicare".
What is Medicaid?
Medicaid is run by the federal and state governments to provide healthcare to low-income families and individuals, including children, elderly adults, and people with disabilities. The federal government sets the standards for Medicaid, but eligibility and coverage vary by state.
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