Medicare enrollment blitz does not include options to upgrade to Medigap

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Medicare’s annual open enrollment season has arrived, and millions of beneficiaries – driven by a massive advertising campaign and aided by a comprehensive federal website – will choose a private Medicare Advantage plan.

But those who have opted for traditional health insurance instead face a critical decision regarding private insurance. Too often, the scope of this choice is not well communicated.

If beneficiaries decide to use traditional Medicare when they first join the program, they can choose a private supplemental plan – a Medigap plan – to help cover Medicare deductibles and large copayments for stays at home. hospital, doctor’s visits and other services.

But many people don’t realize that, in most states, beneficiaries have guaranteed access to a Medigap plan for only six months after enrolling in Medicare Part B – either at age 65 or when they leave the hospital. private health insurance and join Part B.

While the Medicare.gov website offers a guide to these Medigap plans – labeled A through N – it’s a complicated decision because each plan offers different types of coverage – for 10 benefit categories. Then there are the variants with high deductibles and limited supplier networks. The premiums vary greatly, of course. And because seniors sign up for these plans throughout the year when they reach Medicare eligibility, there is much less publicity about the options.

As long as a beneficiary pays the premiums, they cannot be deregistered from a Medigap plan.

For many of those who at some point have opted for Medicare Advantage but later decide to switch to traditional Medicare, obtaining a Medigap policy can be extremely difficult, if not impossible.

Many people who choose their plan this season may have missed their narrow window to sign up for Medigap. This means they may be stuck in Medicare Advantage or their current Medigap plan.

Ken Singer, 68, of Bridgewater, New Jersey, who retired from an investment management firm, was unaware of the limited ability to purchase a Medigap policy. “Nobody told me that,” he said. “I have read a lot about Medigap, but found it a bit confusing.” He wants a policy because he is leaving his wife’s medicare plan.

“Few people who age in Medicare at age 65 fully understand that this time may be their only opportunity to opt for Medigap,” said Brian Connell, executive director of federal affairs at the Leukemia and Lymphoma Society. “If you miss that short window, you end up with no protection against high out-of-pocket expenses. “

While Medigap plans generally have higher premiums than Medicare Advantage plans, the more expensive ones offer better protection against out-of-pocket expenses.

After a beneficiary’s initial six-month window, federal law does not prohibit Medigap insurers from rejecting applicants or charging a very high premium if they have a pre-existing medical condition, unlike the Affordable insurance market. Care Act for people under 65. Only four states require insurers to offer Medigap coverage to applicants, regardless of their age or medical condition. Medigap covers nearly 13 million beneficiaries.

In contrast, federal rules require Medicare Advantage plans to accept all applicants and charge the same premium regardless of their medical condition. Reimbursable expenses in Medicare Advantage plans are capped at $ 7,550 this year for network care, not including prescription drugs. Traditional health insurance has no cost cap, but some of the Medigap plans cover the vast majority of those expenses that would otherwise be borne by the insured.

At least in part because of these uneven consumer protections, 17% of the 33 million people with traditional health insurance do not have supplemental insurance, according to Tricia Neuman, executive director of insurance policy. disease in KFF. Their personal expenses can reach tens of thousands of dollars per year for serious illnesses like cancer or kidney disease.

Linda Ginsburg of Jacksonville, Fla. Unknowingly missed her chance to purchase a Medigap policy last year at the age of 65.

Because she has cancer, the retired medical practice manager qualified for Medicare through Social Security disability insurance before she turned 65, and signed up for a Medicare Advantage plan. . She was paying a monthly premium of $ 385 – $ 4,620 per year – and was facing $ 7,000 per year in out-of-pocket expenses, not to mention her large prescription drug bills. So, last year before her birthday, she called two insurance brokers to switch to traditional health insurance and get a Medigap plan, which she said would provide better and cheaper coverage. Medicare rules provide an open enrollment option in Medigap for beneficiaries with disabilities when they reach age 65.

The two brokers told her, mistakenly, that she couldn’t change because she had cancer. “They said the insurers wouldn’t take you, you should stay where you are,” Ginsburg recalled. “They had no idea this was a period I could have walked in without being asked about my cancer.”

Now she’s stuck – and angry. “I thought screening for pre-existing conditions was against the law,” she lamented. “But that’s not true when you reach Medicare age.”

Part of the confusion is due to the very different state rules governing Medigap policies. Connecticut, Maine, Massachusetts and New York require insurers to accept any claimant regardless of age or medical history, according to KFF.

In other states, people over 65 have federally guaranteed access to a Medigap plan only in limited circumstances, such as if they move or leave a Medicare Advantage plan in their first year. health insurance. Twenty-eight states guarantee people access to a Medigap plan if their employer terminates their health benefits upon retirement.

Then there are very different state rules on how Medigap insurers can price their plans. Eight states prohibit charging people more because they are older or sicker. Other states allow premiums to be set based on age, which means that a Medigap policy may well be unaffordable for seniors.

The situation is worse for the nearly 9 million beneficiaries under the age of 65 who are entitled to Medicare due to long-term disability. Only 31 states require insurers to sell a Medigap policy to people in this group.

Members of one subgroup – kidney dialysis patients under 65 – have even more limited access to an affordable Medigap policy. Only 14 states require insurers to provide affordable coverage. Starting last year, the federal government guaranteed them access to Medicare Advantage plans, but not a Medigap policy. But Medicare Advantage plans may not include the providers that dialysis patients need, said Holly Bode, vice president of government affairs at the American Kidney Fund.

Guaranteed access to an affordable Medigap policy is important, say consumer advocates, because beneficiaries who develop serious medical conditions disproportionately want to leave their Medicare Advantage plan for the wider choice of providers available through Medicare. traditional.

A Government Accountability Office report in July urged Medicare officials to examine why beneficiaries in their last year of life went from Medicare Advantage to traditional Medicare at more than twice the rate of others enrolled in Medicare Advantage.

Some lawmakers are already pushing to reorganize the Medigap market. The Close the Medigap Act, recently reintroduced by Representative Lloyd Doggett (D-Texas), chair of the House Ways and Means Health subcommittee, would ensure that beneficiaries with pre-existing conditions could purchase a Medigap policy at any time and would not be faced with higher premiums.

Another bill, sponsored by Rep. Jaime Herrera Beutler (R-Wash.) And Rep. Cindy Axne (D-Iowa), would require Medigap insurers to offer the same plans to kidney dialysis patients under 65 as ‘they offer beneficiaries 65 and above.

Health insurers have generally opposed bills that require them to guarantee coverage or affordable pricing for Medigap plans, arguing it would increase premiums for current policyholders. AHIP (America’s Health Insurance Plans), an industry lobby group, has taken no position on these two bills.

Neither bill, however, is included in the Democrats’ broad legislative package to expand health and social programs. In a written statement, Doggett expressed his disappointment, saying that extending protections against pre-existing conditions to the Medigap market is “one of the important remaining unfinished business of the Affordable Care Act.”

KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism on health issues. Along with policy analysis and surveys, KHN is one of the three main operational programs of the KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization that provides information on health issues to the nation.

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