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Medicare Recipients Can Be Denied Supplemental Medigap Coverage Due to Pre-Existing Conditions

  • Publish Date : 2018/11/15 - (Rev. 2018/11/29)
  • Author : The Senior Citizens League*
  • Contact : seniorsleague.org


Senior Citizens League warns elderly considering dropping Medicare Advantage plan for traditional Medicare and supplemental Medigap policy to get counseling before canceling health plan.

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Older adults who are considering dropping their Medicare Advantage plan to return to "traditional" Medicare and a supplemental Medigap policy are urged to get counseling before canceling their health plan, warns The Senior Citizens League.

"There are no federal pre-existing condition protections for retirees who want to leave their Medicare Advantage plan, which allows individuals to buy a Medigap policy. This is also the case for people who already have a Medigap policy, and who just want to switch to a different one," says Mary Johnson, a Medicare policy analyst for The Senior Citizens League. "Older adults can be denied coverage by Medigap insurers due to pre-existing medical conditions, because of the lack of 'guaranteed issue' protections," Johnson says.

Depending on the plans selected, Medigap policies cover some or all of Medicare-covered out-of-pocket costs. These include deductibles, and co-insurance.

Johnson notes that the guaranteed issue protections that Medicare recipients enjoy when they enroll in Medicare Advantage and free-standing Part D plans - which allow plan enrollees to shop and switch plans annually - don't apply to Medigap policies.

When guaranteed issue rights apply, the insurer must sell consumers a policy that covers all pre-existing conditions, and cannot charge more for the policy because of past or current health problems.

Older adults who want to purchase a Medigap policy, however, only have a one-time, 6-month initial enrollment period that begins when they first enroll in Medicare Part B.

"While there are a few exceptions for special circumstances, retirees who give up their Medigap supplement or retirees who want to try Medigap after being enrolled in Medicare Advantage for more than 12 months have missed the opportunity to get a supplement in the future," Johnson says.

Only four states require either continuous or annual guaranteed issue protections for Medigap for all beneficiaries in the original Medicare;

  • California
  • Connecticut
  • Maine
  • New York

There are a few special exceptions, such as when a Medicare Advantage plan is leaving Medicare or moving out of the enrollee's coverage area.

There's also an exception if an enrollee first joins a Medicare Advantage Plan when first eligible at 65 and then decides to switch to traditional Medicare within the first year of joining.

The Medicare website, https://www.medicare.gov outlines the special circumstances under which beneficiaries may qualify for Medigap guaranteed issue rules.

The Senior Citizens League recommends that people shopping for a new health plan get free unbiased one-on-one assistance from a State Health Insurance Program (SHIP) counselor. The programs vary in name depending on location, but many operate out of Agencies on Aging, local senior centers, and social services departments.

The Senior Citizens League believes guaranteed issue rules for all private Medicare insurance plans and supplements should be made consistent, to allow purchasers of Medigap supplements to compare policies and switch to better or lower-costing ones, in the same way that beneficiaries already can for Medicare Advantage and Part D plans.

With 1.2 million supporters, The Senior Citizens League is one of the nation's largest nonpartisan seniors groups.

The Senior Citizens League mission is to promote and assist members and supporters, to educate and alert senior citizens about their rights and freedoms as U.S. Citizens, and to protect and defend the benefits senior citizens have earned and paid for.

The Senior Citizens League is a proud affiliate of The Retired Enlisted Association. Visit https://seniorsleague.org for more information.

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