Why is Medicare Different in Each State?

by David Bynon, last updated

You may have noticed that Medicare is not the same everywhere. Plans are different. Costs are different. And benefits are different, too.

In this article, we’ll explain the differences in Medicare and how you can get the most benefits possible, no matter what state you’re in.

Key Takeaways

  • Medicare is a federal program that provides health insurance to people ages 65 and up, and to individuals with certain disabilities.
  • The Medicare program has four parts: A, B, C, and D. Each part has different rules and costs.
  • Only Part A (hospital insurance) and Part B (medical insurance) have standardized coverage in all states and territories.
  • Part C (private health plans) and Part D (prescription drug coverage) are sold by private insurance companies. Medicare regulates these products, but they are not standardized.
  • Medigap plans that work with Part A and B are standardized. Private insurance companies sell them, and rates vary by coverage, state, age, gender, and other factors.

Does it Matter What State You Live in for Medicare?


Although we are all guaranteed the same core Medicare benefits for inpatient care and medical care, where you live matters. In fact, it matters a lot.

Since its inception, Medicare has always had private insurance company involvement. At first, it was just Medicare Supplement Insurance (Medigap). Then, after the Medicare Modernization Act was passed, we got Medicare Advantage plans and Medicare prescription drug plans.

Although Medicare regulates what private health plans must include, it does not regulate their monthly premiums, out-of-pocket costs, or the delivery of healthcare services. This allows insurance companies to create plans that best serve local populations, and allow them to compete.

You might be surprised to learn that Medicare Advantage plans are not available everywhere. In fact, there are more than 200 counties that have no plans available at all, including the entire state of Alaska.

Does My Medicare Coverage Change If I Move to Another State?

No. We are all guaranteed the same coverage.

The federal government guarantees that all of the services and benefits available in Medicare Part A and Medicare Part B are available to beneficiaries no matter what. Where you live does not matter. And how you choose to receive your benefits does not matter.

However, if you qualify for both Medicare and Medicaid, where you live could make a difference. Unlike Medicare, Medicaid is a joint state and federal program. Each state determines its own level of funding.

Many states that expanded their Medicaid funding under the Affordable Care Act (Obamacare) offer Medicaid beneficiaries more benefits, such as coverage for routine dental, vision, and hearing.

As a result, we now see more Medicare Special Needs Plans (SNPs), for dual-eligible individuals, in the states that expanded their Medicaid programs. We have a tool that allows you to find and compare Special Needs Plans available in your area.

Is Medicare Run By Each State?


Both Medicare and Medicaid are run by the same federal agency, the Centers for Medicare & Medicaid Services (CMS).

Why Aren’t Medicare Plans Available Everywhere?

By law, CMS can regulate private health plans, but it can’t mandate that insurance companies offer plans.

Most health plans use provider networks to deliver care to their members. When a pool of providers does not exist, it isn’t possible to create a provider network for Medicare coverage.

Why Do Medicare Advantage Plan Costs Vary So Much?

In a word, competition.

In large metro area, there are more plan vying for members. As a result, both monthly premiums and maximum out-of-pocket limits are lower.

For example, in Los Angeles County, the average monthly premium is just $5.45 per month and the average maximum out-of-pocket (MOOP) limit is $2,552 per year (2023 rates). Compare this to one of California’s most rural areas, Sierra County, where the average premium is $43.50 per month and the average MOOP is $6,100 per year.

When it comes to Medicare Advantage plans, Medicare beneficaries in large counties have the advantage.

Why Don’t All Areas Have 5-Star Medicare Advantage Plans?

Medicare Advantage plans are not the same everywhere.

Most Medicare Advantage plan organizations are local, not national. And, all Medicare Advantage plans, with the exception of Medicare Cost plans and Medicare Savings Account plans have local provider networks. Provider networks play a huge part in people’s perception of plan quality.

This is one of the reasons that Kaiser Permanente is consistently rated the best plan in the country. Kaiser’s provider network is mostly made up of healthcare professionals that work directly for Kaiser. This gives Kaiser more control over its quality control processes.

Larger, nationwide health insurance companies, like UnitedHealthcare (UHC), do not own their hospitals and and healthcare centers. That said, UHC has made exceptional improvements in its quality control processes, which shows in its latest Medicare Advantage plan 5-star scores.

Use the following tool to find 5-star plans where you live.

Find Plans in your area with your ZIP Code

Are There Premium-Free Plans Everywhere?

Only Medicare Part A is available premium-free everywhere. If you worked and paid Medicare taxes for a minimum of 40 quarters, you don’t pay a premium for Medicare Part A.

Everyone, in all states, pays a Medicare Part B premium, even if you have Medicare Advantage or a Medigap plan. Some low-income individuals qualify for premium assistance through the Medicare Savings Program.

Some areas have Medicare Advantage plans that do not charge an additional premium. An, although there are some cheap Medicare Supplements, there are no free Medicare Supplements.

Does a Medicare Supplement Insurance Plan Work Everywhere?

Yes. Everywhere you have Medicare coverage, you also have coverage from your Medigap plan.

Medicare covers you in all 50 states and all U.S. territories. However, it does not cover you outside of the USA or its territories.

Some Medigap plans offer foreign travel emergency coverage. The most common plans that cover you abroad include Plan F, Plan G, and Plan N. The following chart shows what each plan covers:

Medicare Supplement Plans Comparison Chart for 2024

Can I Keep My Medigap Plan If I Move?

Yes. In most cases you can keep your current Medicare Supplement plan, even if you move to a new state.

There are no federal or state laws that allow a private insurance company to cancel you Medicare Supplement insurance if you move from the state where it was purchased. However, your new state may have better rates or better protections.

Moving from one state to another can have a significant impact on how much you pay for your Medigap plan. It can also have an impact on your right to buy a different policy. Some states have enacted annual Medicare Supplement open enrollment rules that allow an annual change, known as the birthday rule, but most don’t.

Likewise, eight states have laws that do not allow Medicare Part B excess charges. These are additional charges that people with Original Medicare pay if a doctor does not accept Medicare’s standard rates. In these few states, it is not as important to have a Medigap plan that covers excess charges, such as Plan F, Plan C, or Plan G.

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What About Medical Underwriting?

Original Medicare beneficiaries do not have to worry about medical underwriting. Your Medicare Part A and Part B benefits cannot be denied due to pre-existing conditions. And, the federal government prohibits Medicare Advantage plans and Medicare prescription drug plans from denying coverage due to health conditions, as well.

However, medical underwriting is allowed with Medigap insurance. Unless you have Medigap protections, specifically a guaranteed issue right, you can be denied a Medigap policy. Or, you may have to pay higher premiums or have a waiting period.

Medigap beneficiaries only have a guaranteed issue right when they first sign up for Medicare Part B (6-month period) and under special circumstances.

Medicare grants a Special Enrollment Period (SEP) to individuals for special circumstances. One of those circumstances is when you move outside of your current Medicare plan’s service area. An SEP can apply to Medigap policies, Medicare Advantage plans, and Medicare Part D plans.

Does Moving Affect My Medicare Part D Plan?

Moving can potentially have a big impact on your Medicare prescription drug plan.

If you have either a Medicare plan that includes Part D, or a stand-alone Medicare prescription drug plan, and you move out of the plan’s service area, you will need to switch plans.

Most Medicare Advantage plans include Part D benefits. So, if you move out of the plan’s service area, you will need to switch plans.

Most stand-alone Part D plans are national plans. However, some are regional. Regardless, what you pay at the pharmacy will likely be impacted, even if you are able to keep the same plan.

All prescription plans have arrangements with their preferred pharmacy for prescription drugs. These arrangements control pricing, which can vary widely from zip code to zip code.

What If I Have Limited Income?

Individuals with limited income may be affected by a move. Average premiums on both Medicare Advantage plans and Part D plans vary by state.

Also, Medicare enrollees who qualify for Medicaid may be affected. Social Security benefits do not change, including the Extra Help Program, but the availability of Specicial Needs Plans in most states is highly dependent on where you live. A licensed insurance agent can tell you if you qualify for certain programs and help you find Medicare plans or additional coverage.

Use the following tool to find SNP plans where you live.

Find Plans in your area with your ZIP Code

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