Aetna vs Anthem: Which is Best for You?

Are you 65 and exploring your options for health insurance coverage? If so, there are a lot of things to consider. For private Medicare insurance, the options are almost infinite. Selecting the right choice can feel overwhelming.

Aetna and Anthem are two of the largest and best-regarded health insurance providers in the United States. They both offer alternatives and supplemental insurance plans to original Medicare. They also offer prescription drug coverage plans.

The information below will help you weigh the pros and cons of each. Being equipped with the right information is the first step to selecting a suitable plan for your budget and your healthcare needs.

Medicare Advantage vs. Medicare Supplement

Before we compare different insurance companies and their plans, it is important to understand the advantages of private Medicare insurance plans over original Medicare.
The main benefit of original Medicare is that it covers most services. And there are few limits on what doctors or specialists you can visit--there is no “network” of providers.

But, there are a few potential disadvantages. One is that there can be large copays, coinsurance, and deductibles associated with certain services.

Next, with original Medicare, there may not be a cap on how much you pay out-of-pocket each year. A surgery or unexpected emergency could yield a large medical bill.

Finally, original Medicare does not usually cover specialty services like vision, hearing, or dental. Medicare Advantage or supplemental plans can provide this safety net.

Medicare Advantage is a plan offered by a private health insurance company that has contracted with Medicare. It is a completely separate plan from original Medicare.

Medicare Supplement, or “Medigap,” is an insurance plan that you buy in addition to your original Medicare coverage. It works to cover costs that Medicare does not. It will help pay for copays, coinsurance, and deductibles. It could also help cover other large out-of-pocket costs, such as an unexpected emergency room bill.

Although Medicare Advantage is a component of the Medicare program, it functions as a stand-alone insurance plan. Medicare Supplement does not. To purchase it, you will need to enroll in Medicare Part A and Part B. (Medicare Part A is hospital coverage. Part B is the basic health coverage component of Medicare.)

Unlike Medicare Advantage plans, Medigap does not cover extra benefits like dental, hearing, or vision. It also does not include prescription drug coverage or Medicare Part D. Whereas Medicare Advantage plans often include a prescription drug coverage option.

Medicare Supplement allows you to retain the flexibility of original Medicare associated with being able to visit almost any provider. Conversely, Medicare Advantage plans will have a network of providers. It is possible to see out-of-network providers with these plans. But you will most likely pay higher copays or coinsurance for doing so.

Note that you cannot combine Medicare Supplement with Medicare Advantage plans. Medicare Supplement can only be used to cover costs associated with original Medicare.

Aetna vs. Anthem: The Basics

Anthem is part of Blue Cross Blue Shield, which was founded in 1929. It is the second-largest health insurer in the United States (behind UnitedHealthcare). It provides coverage to more than 100 million people.

Aetna was founded in 1853 as a life insurance company. It is part of CVS Health Corporation and provides health coverage to almost 40 million people.

Although Anthem has a larger membership overall, Aetna currently serves more Medicare recipients, at 2.2 million. Anthem covers approximately 1.9 million on its Medicare plans.

The financial rankings of both companies are excellent. Although Anthem’s is a bit higher, you can be sure that both companies are financially stable.

Availability

In general, you can initially enroll in Medicare three months before you turn 65 and up to one month after the month you turn 65. After that, annual enrollment is between October 15 and December 7.

With Medicare Advantage and Medicare Supplement plans, there will be a specific enrollment period as well. For Medicare Supplement, there is a single lifetime option, after you have enrolled in original Medicare. For Medicare Advantage plans, there is a regular, annual open enrollment period.

Aetna offers Medicare Advantage plans in 45 states and Washington, DC. It offers Medicare Supplement plans in 49 states. And its prescription drug plans are available nationwide.

Anthem offers Medicare Advantage, Medicare Supplement, and its prescription drug coverage plans in only 14 states. However, there may be other Blue Cross Blue Shield plans available in your state, even if Anthem is not.

If you plan to enroll in a Medicare Advantage, Medicare Supplement, or a private Medicare prescription drug plan, then where you live could be the determining factor. If both Aetna and Anthem plans are offered in your state, then there are other considerations.

Coverage

One of the first things to look at beyond availability is coverage. Medicare Supplement plans are standardized across the country. So, if an insurer offers this coverage, then it will be at the same level as all other companies. That does not mean you should not look at the details of the coverage from year to year. It just means that you do not have to compare plans between companies.

By law, Medicare Advantage must provide at least the same level of coverage as original Medicare. But it can go beyond it. Since health insurance companies decide what goes into each plan, Medicare Advantage plans will vary in coverage from company to company. 

For Medicare Advantage plans, Anthem’s wider network of providers could be a deciding factor. Nationwide, more than 96 percent of hospitals and 95 percent of all doctors, including specialists, contract with Blue Cross Blue Shield companies. This is some of the most comprehensive network coverage of any health insurance company.

However, this does not mean that they cover the doctors that you normally see. Look at both companies’ networks and ensure that your current doctors and other healthcare providers are covered in their network. Also, look at broader network availability in your region, and consider potential health needs down the road.

Both Aetna and Anthem offer Medicare Part D coverage. Not all private health insurance companies do. But if you are purchasing a prescription drug plan, make sure that the medications you need are covered by the plan’s formulary.

Look at the copayment or coinsurance amounts for each drug. Note that formularies can change from year to year, so this is something you will want to revisit on a regular basis.

Also, with both Aetna and Anthem plans, renewal is guaranteed. This means they cannot cancel your coverage because of health conditions.

Cost

A general rule of thumb is that the higher the premium, the better the coverage and the lower the co-pays, coinsurance, and deductibles. Correspondingly, high deductible plans will offer lower monthly premiums.

The question to ask is whether or not the cost of a Medicare Advantage plan is a good value versus costs associated with original Medicare plus Medicare Supplement.

Be sure you are comfortable with the annual deductible amount. Also, remember that Medicare Advantage plans will have an out-of-pocket cap. But so will Medicare Supplement plans. Beyond these maximums, the plan covers 100 percent of medical costs for the rest of the year.

This can be a huge advantage over having only original Medicare. What level of out-of-pocket cost you are willing to risk relative to your premiums will depend on your budget and the specific coverage you require.

Both Aetna and Anthem use the “attained-age” pricing structure, meaning the closer to 65 you purchase it, the cheaper the plan will be. Premiums will go up as you age.

Also, Aetna offers a 12 percent household discount for its Medicare Supplement plans. This requires you to be living with one other person who is enrolled in the same plan.

Anthem offers a 5 percent household discount. They also offer discounts for enrolling in automatic payments or for paying for an entire year upfront.

Other Benefits

Both Aetna and Anthem have fantastic reviews. Aetna excels at customer service and offering user-friendly web options, including online bill pay and coverage information. It also offers a 30 trial period, where you can cancel during this time if you decide it is not the right plan for you.

Anthem has a reputation for offering a wide range of plans at rates that can be significantly lower than other companies. Both companies have very user-friendly online search options. 

Also, both companies have implemented accommodations related to the COVID-19 pandemic. Aetna, for instance, is waiving all out-of-pocket costs for in-network primary care and specialist telehealth services. This service is for all its members in Medicare Advantage plans.

Find Coverage Now

Go online and read reviews for yourself. Look at customer reviews of Aetna vs. Anthem from your particular state and specific plan, if possible. Also, look at each plan’s Medicare star rating. These are calculated annually, and give an indication of the plan’s quality.

Do your homework and have peace of mind that you are choosing the right company, and the right plan, for you and your family.