How To Find the Right Medicare Supplemental Insurance
Medicare supplemental insurance is offered by private insurers to fill the gaps in Original Medicare. This Medigap coverage pays for a variety of types of health care that Medicare does not cover or covers only partially. Patient eligibility for these supplemental insurance plans is relatively straightforward.
First, you need to be sure of your Medicare eligibility. For the most part, anyone 65 years of age or older qualifies for Medicare. Some younger people, those with certain disabilities and those with End Stage Renal Disease also qualify. Federal laws do not require that insurance companies sell those under 65, even those eligible for Medicare, a Medigap policy. Some states, however, do require insurers to issue policies for people eligible for Medicare and under the age of 65. Original Medicare is broken down into Part A (Hospital) and Part B (Medical) insurance. There are no premiums for Part A if you paid into Medicare while working. Everyone pays a Part B Premium. If you choose to buy a Medigap policy you must pay your premium for that as well.
If you have Medicare Part A and B, and are at least 65 years of age, you are also eligible to buy a Medigap policy. There are some other issues you should be aware of regarding eligibility. The 6 months before and the 6 months after your 65th birthday and your enrollment in Medicare Part B is the Medigap open enrollment period. During this 6 month period, you can buy any Medigap policy offered in your state.
- Insurance companies cannot refuse to sell you a Medigap policy due to a disability or health problem.
- If you do have a disability or health problem Medigap providers cannot charge you a higher premium than they charge others who are 65 years old.
- Sometimes a Medigap insurer can refuse to cover pre-existing health problems for up to six months if you had the problem before the policy begins. This is only true if the health problem was diagnosed/treated in the six months before the policy starts
- If, however, you buy the policy during the open enrollment period and had at least six months of previous “creditable coverage” the company cannot make you wait for any pre-existing condition.
- If you had less than six months of “creditable coverage” the waiting period is reduced by the months of creditable coverage you did have.
Creditable coverage refers to previous coverage that you have had with no interruption. It means you have had coverage with no break of more than 63 days. It can include
- A group health plan (like an employer plan)
- A health insurance policy
- Medicare Part A or Medicare Part B
- A medical program of the Indian Health Service or tribal organization
- A state health benefits risk pool TRICARE (the health care program for military dependents and retirees)
- A Federal Employees Health Benefit Plan
- A public health plan
- A health plan under the Peace Corps Act 71
The open enrollment period is important but if you wait, you will not necessarily lose the possibility of a Medigap policy. It is true that insurance companies are not always required to sell you a Medigap policy. If they do sell you a plan when you are outside the open enrollment period, the cost might be significantly higher. Under some circumstances you may still, however, be able to buy a plan outside the period.
Rules for Medigap vary from state to state. States can have different requirements for companies selling Medigap policies.
One important rule applies to those who choose to become part of a Medicare Advantage Plan. You cannot buy a new Medigap policy if you are part of a Medicare Advantage Plan. If you are not happy with your Medicare Advantage Plan you have special rights to buy a Medigap policy if you return to Original Medicare within 12 months of initially joining.
If you did have a Medigap policy before joining your Medicare Advantage Plan it is possible you can get that same policy back—provided the company you bought it from still sells that particular Medigap policy. Some Medigap policies are no longer offered. Even if you are able to go back to that same policy if that policy included drug coverage you will not be able to get that part of the policy back. You should be able, however, to join a Medicare Prescription Drug Plan (Medicare Part D). If you joined a Medicare plan when you first became eligible for Medicare coverage you can choose from any Medigap plan during the enrollment period or when you exercise your special rights with regard to your Advantage Plan.
You are not required to disenroll from a Medigap plan you already have when you join a Medicare Advantage Plan. You cannot have prescription drug coverage through both a Medigap policy and a Medicare drug plan as noted. Also, it is important to know that you cannot use a Medigap plan to pay for copayments, deductibles, and premiums in a Medicare Advantage Plan like you would if you had Original Medicare. So retaining a Medigap policy when you join a Medicare Advantage Plan is dubious.
As far as eligibility to switch Medigap policies, you usually do not have this right unless you are within the 6 month open enrollment period or have one of a number of specific circumstances that allow this. As noted, different states have different rules and you may be able to switch if an insurer will sell you a policy.