Switching to original Medicare may lead to Medigap plan refusals for seniors.

It is currently open enrollment season for Medicare Advantage, offering individuals enrolled in these private managed care plans the opportunity to either select a new plan or revert to traditional Medicare. This enrollment period extends until March 31. However, individuals looking to switch back to original Medicare and obtain supplemental Medigap insurance to help cover some out-of-pocket expenses may encounter significant challenges. Typically, Medigap insurers engage in a process known as medical underwriting, allowing them to deny coverage based on the applicant’s medical history or existing health issues, which could result in increased costs for insurers.

Kata Kertesz, managing policy attorney at the Center for Medicare Advocacy, emphasizes the importance of this factor for individuals considering a move from a Medicare Advantage plan. Those who have been enrolled in a Medicare Advantage plan for an extended period may find themselves unable to transition back and secure a Medigap plan.

There are various reasons prompting beneficiaries to switch from Medicare Advantage to traditional Medicare. While Medicare Advantage plans often present a lower premium and enhanced benefits—such as coverage for vision and hearing health—that may not be available with traditional Medicare, they also tend to feature smaller provider networks and may impose stringent prior authorization requirements. Additionally, with the profitability of Medicare Advantage plans in decline, an increasing number of these plans are withdrawing from the markets they had previously served. According to a recent study published in JAMA, approximately 10% of Medicare Advantage members will face displacement from their current plans due to such market exits.

For those intending to revert to traditional Medicare, obtaining a Medigap plan can be fraught with difficulties. Federal regulations do provide a one-time, six-month window for individuals aged 65 or older, who are newly enrolled in Medicare Part B, to sign up for any Medigap plan without undergoing medical underwriting. After this initial period, protections against underwriting become more limited.

However, several circumstances guarantee the ability to obtain a Medigap plan without medical underwriting:

1. In Connecticut, Massachusetts, and New York, residents can enroll in a Medigap policy any time of the year without undergoing medical underwriting. Maine offers a one-month annual window for enrollment in Plan A.
2. Individuals who enroll in a Medicare Advantage plan upon first becoming eligible for Medicare Part A at age 65 can switch back to original Medicare within the first year and sign up for a Medigap policy.
3. If a Medicare Advantage plan exits the market or ceases services in a particular area, affected enrollees can transition to original Medicare and secure a Medigap plan without underwriting at specified times before or after the MA coverage ends.
4. Should an individual relocate out of their Medicare Advantage plan’s service area, they may switch to original Medicare and apply for a Medigap policy within a specific time frame surrounding the end of their MA coverage.

State regulations may offer additional qualifying events that exceed federal standards. As a resource, patient advocates recommend consulting with a counselor from the State Health Insurance Assistance Program (SHIP) for free, impartial guidance on navigating Medigap options.

For individuals who don’t qualify for guaranteed Medigap coverage, approval is still possible, though typically at a higher premium and potentially including waiting periods for covering preexisting medical conditions.

Recent trends indicate a tightening in Medigap insurers’ underwriting practices, largely in response to rising claims relative to premiums collected. This shift has resulted in increased scrutiny regarding applicants’ health histories, including the introduction of prescription drug background checks as a factor in underwriting decisions.

Each Medigap insurer operates under distinct underwriting policies, reinforcing the value of consulting SHIP counselors, who can guide applicants to companies that may have more flexible standards regarding preexisting conditions. Additionally, they can offer access to comparison tools to help consumers assess their options in relation to Medigap plans.

As this enrollment period progresses, individuals must weigh their options carefully, keeping in mind the implications of switching plans and the potential challenges associated with obtaining supplemental coverage.

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