Medicare Advantage vs Medigap: How to Choose

1. Introduction

Quick Answer: Medicare Advantage replaces how you receive Medicare. Medigap sits on top of Original Medicare and pays the share Medicare leaves behind. You cannot hold both. Picking between them decides your monthly cost, your worst-case year, and which doctors will take you.

Most people meet this decision in the two months before they turn 65, under pressure and buried in mailers. The mailers all lead with the same number: $0 premium. That number is real. It is also the least useful figure in the comparison, because it describes the month you are healthy, not the year you are not.

At DollarVisor, no insurer can pay for placement, so this page works the arithmetic instead of the brochure. We cover Medicare Advantage vs Medigap from four angles: what each side costs on paper in 2026, what a modeled year of care actually costs under both, how your state rewrites the answer, and what changed in the numbers this year. It sits inside our wider guide to the types of insurance and which ones you need.

2. What Medicare Advantage and Medigap Actually Are

Quick Answer: A Medicare Advantage plan is a private plan that takes over your Part A and Part B benefits and runs them through its own network and rules. Medigap is a private policy that pays Original Medicare’s deductibles and coinsurance for you. One replaces Medicare’s plumbing; the other patches it.

The confusion in Medicare Advantage vs Medigap comes from the fact that both are sold by private insurers, both have monthly premiums, and both are advertised on the same television break. Structurally they are opposites.

• Medicare Advantage (Part C). The government pays a private insurer a set amount each month to cover you. The insurer decides the network, the copays, and what needs approval first. In exchange it can add extras Original Medicare never covered, like dental and vision.
• Medigap (Medicare Supplement). You stay in Original Medicare and see any provider in the country who accepts it. The Medigap policy pays the deductibles and the 20% coinsurance that Medicare hands you. There is no network and nothing to pre-approve.

Medigap plans are standardized by letter, so a Plan G from one insurer covers exactly what a Plan G from another covers: only the price and service differ. Medicare.gov publishes the benefit grid for all ten letters. Plan G is now the default: it held 39% of all Medigap policies in 2023, or about 5.3 million people, according to KFF’s analysis of NAIC data. Plan F covers slightly more but has been closed to anyone turning 65 since January 2020.

One rule ends most of the confusion: a Medigap policy does nothing for you if you are in Medicare Advantage. You cannot stack them. And neither one includes drug coverage automatically: most Advantage plans bundle Part D, while Medigap buyers purchase a stand-alone drug plan separately.

3. What Each One Costs in 2026

Quick Answer: Everyone pays the $202.90 Part B premium in 2026. On top of that, 75% of Medicare Advantage enrollees pay nothing extra, while the average Medigap Plan G runs $164 a month. The gap is about $1,968 a year, which is roughly what one bad hospital month costs on the Advantage side.

Read the table below from the bottom up. The premium rows favor Medicare Advantage by a wide margin. The exposure rows (the cap, the coinsurance, the approval rules) are where Medigap earns its price back. The Part A and Part B figures come from the CMS 2026 Parts A & B premiums and deductibles fact sheet.

Two numbers in that table deserve a second look. The first is $5,421: the average in-network out-of-pocket limit across Medicare Advantage enrollees in 2026, per KFF. The second is $1,968: a full year of average Plan G premiums. The Advantage cap is 2.75 times the Medigap premium, which is the entire bet in one sentence.

4. A Modeled Year: Three Levels of Use

Quick Answer: In a light year, an average Medicare Advantage plan costs about $1,900 less than average Medigap Plan G. In a moderate year the two land within about $50 of each other. In a heavy year Medigap wins by roughly $3,200, and by more than $7,500 if the care goes out of network.

The comparison below is an illustrative model, not a quote. It holds the $202.90 Part B premium out of both columns because everybody pays it, ignores drug costs, and assumes national averages: a $0-premium Advantage plan with the average $5,421 in-network cap, against Plan G at $164 a month plus the $283 Part B deductible.

The pattern holds across every version of this model we run, and it is the whole of Medicare Advantage vs Medigap in three rows. Advantage wins the years you barely use it, ties the year something moderate happens, and loses badly the year you are hospitalized. Medigap is not cheaper insurance. It is a way of paying the bad year in advance, in twelve equal pieces: the same logic that decides which policies to fund first at any age.

5. Networks, Approvals, and What You Trade

Quick Answer: Nearly all Medicare Advantage enrollees (99%) are in plans that require prior authorization for some services, and the approvals cluster on the expensive care. Original Medicare with Medigap almost never asks. That difference is the real price of the lower premium.

This is where Medicare Advantage vs Medigap stops being about money. Advantage plans fund their extras by managing what gets used. In 2026 the share of enrollees whose plans require prior authorization looks like this, per KFF’s June 2026 analysis:

• Acute inpatient hospital stays: 97%. The admission itself has to clear review.
• Skilled nursing facility stays: 95%. This is where most rehab disputes start.
• Part B drugs: 94%. Infusions and injectables given in a clinic.
• Home health: 90%. Often requested straight out of a hospital discharge.
• Preventive services: 6%. Routine care is almost never gated.

For scale: insurers processed nearly 53 million prior authorization determinations in 2024 and denied about 4.1 million, roughly 8%. Appeals often succeed, but they happen while someone is sick.

The network side is quieter and matters as much. Advantage enrollees reach about half the physicians available to traditional Medicare beneficiaries locally, on average. Six in ten are in HMOs, which generally pay nothing out of network.

6. Your State Changes the Answer

Quick Answer: Only four states (Connecticut, Maine, Massachusetts and New York) let people 65 and older buy Medigap without medical underwriting either year-round or once a year. Everywhere else, federal minimums apply, and Plan G premiums swing from about $140 to $236 a month.

Medigap is regulated state by state, so two people with identical health can face completely different versions of Medicare Advantage vs Medigap. Two state rules matter: whether you can be turned down, and which rating system sets your price.

Take-up follows the rules. KFF’s analysis of NAIC data puts Medigap at 42% of traditional Medicare nationally, ranging from 9% of beneficiaries in Hawaii to 67% in Iowa, with more than half holding a policy in eleven states. The plains and Midwest states with the highest Medigap take-up are the same ones where Advantage enrollment stayed lowest, which is why Medicare Advantage vs Medigap is a live argument in Des Moines and barely one in Honolulu.

7. The One-Way Door Nobody Warns You About

Quick Answer: You get one guaranteed six-month window to buy any Medigap policy, starting the month your Part B begins at 65. Miss it, and in most states an insurer can review your medical history and turn you down. Advantage plans have no such gate, in either direction.

This is the part of Medicare Advantage vs Medigap that catches people, because it is asymmetric. You can move into Medicare Advantage during any annual enrollment period, at any age, in any health. Moving back out and picking up a Medigap policy is a different matter entirely.

Federal law gives you three reliable openings, as Medicare.gov sets out:

1. Your six-month Medigap open enrollment. Starts the first month you are both 65 and enrolled in Part B. Any policy sold in your state must take you, at the standard price.
2. The Medicare Advantage trial right. If your first-ever Advantage plan is joined at 65 and you leave within twelve months, you can buy any Medigap policy sold in your state.
3. Qualifying events. An employer drops the health coverage you were relying on, or your plan leaves your area. You then have 63 days to apply.

Outside those windows, most states allow medical underwriting, and a diabetes or heart disease diagnosis can mean a decline or a loaded premium. The consequence shows up in the data: only 7% of traditional Medicare beneficiaries under 65 with disabilities hold a Medigap policy, against 46% of those 65 and older, because the federal guarantee never extended to them.

One more trap. Even inside a guaranteed window, an insurer can impose a six-month waiting period on pre-existing conditions if you lacked six months of prior continuous creditable coverage. Coming straight off an employer plan usually avoids it.

8. What Changed Going Into 2026

Quick Answer: The Part B premium rose $17.90 to $202.90 and the Part B deductible rose $26 to $283 in 2026. Average Medicare Advantage supplemental premiums ticked up for the first time in a decade, and the average in-network out-of-pocket limit climbed about $700 above its 2023 low.

Every figure below is what Medigap is buying you out of. CMS published the 2026 Part A and Part B amounts in November 2025. When Original Medicare’s cost sharing rises, a Plan G premium buys more coverage than it did the year before, and an Advantage plan’s cap does not automatically follow.

One more piece of context worth knowing. Advantage plans can offer $0 premiums partly because Medicare pays them a rebate above their estimated costs: roughly $2,664 per enrollee in 2026 according to MedPAC. The extras are funded, not free.

9. Who Should Pick Which

Quick Answer: Pick Medicare Advantage if the extra premium would strain your budget, your doctors are in network, and you stay near home. Pick Medigap if you have a chronic condition, travel or split the year between states, or simply cannot absorb a $5,000 surprise.

Medicare Advantage usually fits better when:

• An extra $164 a month is money you do not have, and a $0-premium plan is what makes the budget work.
• Your existing doctors and hospital are already in the plan’s network: check each one by name, not by health system.
• You get most of your care locally and rarely travel for long stretches.
• The dental, vision and hearing extras have real value to you and you would otherwise buy a stand-alone dental and vision policy anyway.

Medigap usually fits better when:

• You have a diagnosis that makes future underwriting risky, so this is your one clean shot at getting in.
• You want any doctor in the country, including out-of-state specialists and second opinions.
• You spend part of the year in another state, which networks handle badly.
• A predictable bill is worth more to you than a low one, and a $5,421 year would force hard choices.

If Medicare Advantage vs Medigap still feels like a coin toss after all that, the tiebreaker is your state. In Connecticut, Maine, Massachusetts and New York you can start with Medicare Advantage and move to Medigap later without a health review. In the other 46 states and DC, treat the Medigap door as closing permanently six months after your Part B starts.

10. Conclusion: How to Choose in 2026

Medicare Advantage vs Medigap is not really a price comparison, even though it is sold as one. It is a question about which risk you would rather carry: a known monthly premium, or an unknown annual bill capped somewhere north of $5,000.

Work it in this order. Check whether your state gives you a second chance at Medigap. Price Plan G locally and compare that annual figure against the out-of-pocket limit on the Advantage plans you are considering, not against their premiums. Then check your actual doctors against the network list, one name at a time. If Plan G costs less per year than the plan’s cap and your health is anything other than robust, the arithmetic points to Medigap. If the premium simply does not fit, an Advantage plan with a low cap and your doctors in network is a sound choice, and CMS projects about 34 million people will make it in 2026.

Whichever way you go, revisit it every fall. Advantage networks, caps and extras change annually, and the rest of your insurance stack should be reviewed on the same schedule.

11. Medicare Advantage vs Medigap: FAQ

Is Medicare Advantage or Medigap cheaper?

Medicare Advantage is cheaper in a light year and more expensive in a heavy one. Three-quarters of Advantage enrollees pay no premium beyond Part B, while Plan G averages $164 a month. But the average Advantage in-network cap is $5,421, against about $2,251 a year all-in for Plan G.

Can I switch from Medicare Advantage to Medigap later?

Only reliably within your first twelve months in an Advantage plan joined at 65, or if you live in Connecticut, Maine, Massachusetts or New York. In the other 46 states and DC, insurers can review your medical history and decline you or raise your price.

How much does Medigap Plan G cost in 2026?

Nationally the average Plan G premium was $164 a month in the most recent annual data, ranging from about $140 in Washington DC to $236 in New York. Your own quote depends on your state, age, ZIP code, smoking status and the insurer’s rating method.

Does Medigap cover prescription drugs?

No. Medigap policies sold today do not include drug coverage, so you buy a stand-alone Part D plan separately: averaging about $36 a month in 2026. Most Medicare Advantage plans bundle drug coverage instead, which is a real convenience advantage.

What is the out-of-pocket maximum on a Medicare Advantage plan in 2026?

Plans may not exceed $9,250 for in-network services or $13,900 combining in-network and out-of-network care in 2026. Actual limits average $5,421 in-network. Original Medicare has no cap at all, which is precisely the gap Medigap fills.

Which states let you buy Medigap without medical underwriting?

Connecticut, Maine, Massachusetts and New York require insurers to sell to anyone 65 and older either year-round or once a year, regardless of health. Thirty-six states also require at least one policy be offered to people under 65 with disabilities, though premiums vary.

This page is for information only and is not financial, tax, or insurance advice. Medigap premium figures are averages from the most recent annual NAIC data and the modeled year is illustrative; confirm current pricing with the insurer and your state’s rules with your Department of Insurance or State Health Insurance Assistance Program. See our full disclaimer.