• Senior with Medicare Advantage in a hospitalImage by Flickr.com, courtesy of Enrico
  
  

History

• The Balanced Budget Act of 1997 provided Medicare recipients the right to obtain health coverage through private companies. Known as Medicare+Choice, this eventually became known as Medicare Advantage with the passage of the Medicare Prescription Drug, Improvement and Modernization Act of 2003.
  
  

Features

• Medicare supplement insurance is essentially a program in which seniors can get additional coverage from a private company. Medicare Advantage allows a senior to roll Medicare coverage into a private insurance organization.
  
  

Function

• Since Medicare Advantage allows beneficiaries to roll the financial cost of their benefits package into private companies, private companies stipulate the terms of use for the enrolled individuals, such as networks and payment limitations.
  
  

Significance

• The major advantage of Medicare supplements over the Advantage plan is that seniors still retain the basic Medicare coverage. Since a supplement is simply more coverage, the individual is always guaranteed the federally-backed insurance.
  
  

Considerations

• Medicare Advantage usually has the bonus of better prescription drug coverage than basic Medicare Part D. The private insurance companies are able to negotiate with drug companies, while the federal government does not have that right.