滨迟鈥檚 season for Medicare Advantage, when people currently enrolled in private managed-care plans can either sign up for a new one or switch to original Medicare through March 31.
But there鈥檚 a catch: If people want to move to original Medicare and buy a supplemental Medigap insurance plan to cover some out-of-pocket costs, they may not be able to. Medigap insurers can generally refuse coverage to applicants whose medical history or current health problems might make them expensive to cover, a process called medical underwriting.
鈥淲e really want people to factor that in,鈥� said , managing policy attorney at the Center for Medicare Advocacy. 鈥淚f someone is in a Medicare Advantage plan for several years and then wants to switch to original Medicare, they may find they can鈥檛 switch and also get a Medigap plan.鈥�
There are many reasons people might want to trade their MA plan for traditional Medicare. Although MA managed-care plans are typically cheaper and offer benefits not available in original Medicare, such as coverage for vision and hearing services, they have smaller provider networks than the original program and, sometimes, extensive prior authorization requirements.
In addition, as Medicare Advantage plan in recent years, a growing number of plans are pulling out of areas they used to serve, leaving members with fewer options. This year, an estimated 1 in 10 MA plan members will be forced out of their plans for this reason, according to a in February.
鈥淲e saw some Medicare Advantage plans that just left the market completely and stopped issuing plans,鈥� said Emily Whicheloe, education director at the Medicare Rights Center.
For those considering a switch to original Medicare, getting a Medigap plan can be tricky. Federal law provides a one-time, for people 65 or older and newly covered by Medicare Part B to sign up for any Medigap plan without underwriting. After that initial sign-up period ends, however, there are fewer coverage guarantees.
But some do exist. Here are a few key circumstances and time frames when people are guaranteed a Medigap plan without having to undergo underwriting:
- People who live in Connecticut, Massachusetts, or New York can sign up for a Medigap policy without underwriting. In Maine, there is a one-month window each year when Medigap insurers must offer Plan A to all comers without underwriting. (Plan A provides less comprehensive coverage than some of the other standardized plan types.)
- People who sign up for a Medicare Advantage plan when they are first eligible for Medicare Part A at age 65 can switch to original Medicare within the first year and buy a Medigap plan too. This is sometimes called the 鈥�.鈥�
- If a Medicare Advantage plan leaves Medicare or in an area, affected enrollees can switch to original Medicare and buy a Medigap plan either 60 days before or up to 63 days after their MA coverage ends. During this special enrollment period, they can鈥檛 be turned down or charged more based on their health.
- If an individual and no longer has access to their Medicare Advantage plan providers, they can switch to original Medicare and apply for a Medigap policy either 60 days before or up to 63 days after their MA coverage ends. That typically happens when someone notifies the plan of their permanent move or the plan discovers it, said , a training, policy, and technical assistance consultant at California Health Advocates who specializes in Medicare and Medigap coverage.
There are other circumstances when someone might qualify for a special enrollment period under federal rules, and states may have additional qualifying events that are more generous than federal standards.
Patient advocates emphasize that it鈥檚 often useful to work with a counselor at the , or SHIP, for free, unbiased help figuring out Medigap coverage options. SHIP counselors can help applicants identify potential avenues to qualify for Medigap coverage without underwriting at both the federal and state levels.
People who don鈥檛 qualify for a guaranteed right to a Medigap plan without underwriting may still be approved for coverage. Premiums may be higher, however, and plans may impose a waiting period of up to six months for coverage of preexisting medical conditions in certain circumstances.
Beware: More Underwriting
In recent years, some Medigap insurers have spent a growing percentage of premiums on medical claims, putting pressure on profits, Burns said. 鈥淢edigap insurers鈥� underwriting has tightened up considerably recently,鈥� she said.
The list of health conditions that Medigap insurers might deny coverage for is long, including Alzheimer鈥檚 disease, asthma, cancer, congestive heart disease, diabetes with complications, end-stage renal disease, high blood pressure, and stroke, among others, according to a of leading insurers鈥� applications.
When people apply for a Medigap plan that will be medically underwritten, they will typically be asked to fill out a health questionnaire, said , a principal and consulting actuary at Milliman who is a Society of Actuaries fellow. Increasingly, insurers are requesting that people agree to a prescription drug background check, Ortner said.
鈥淥ftentimes, that prescription drug history may be the primary driver of a decision as it relates to underwriting,鈥� he said, rather than a physical exam or medical records review.
Insurers don鈥檛 all have the same underwriting rules, however. Here again, a SHIP counselor may be useful for pointing people to specific companies that accept applicants with a particular medical diagnosis, or have different waiting periods or coverage exclusions.
鈥淭hey have access to a Medigap comparison tool in addition to what is existing on that can give you a very good estimate of what you may pay for those Medigap plans,鈥� said , associate director of health coverage and benefits at the National Council on Aging.