Not applicable: If you are not enrolled in Medicare, are newly comparing Medicare plan types, or are evaluating employer-sponsored retiree coverage, this article may not address your situation.
Switching from Medicare Advantage to Medigap: Timing,
Underwriting, and Your Options
You can switch from Medicare Advantage to Original Medicare plus Medigap
during the Annual Enrollment Period (October 15 to December 7) or the Medicare
Advantage Open Enrollment Period (January 1 to March 31). Outside your one-time
Medigap Open Enrollment Period, expect medical underwriting unless you have a
guaranteed issue right. Higher premiums buy predictable costs and nationwide provider choice.
As your budget, healthcare needs, and benefits change, you may be considering
switching up your Medicare coverage. If you’re enrolled in a Medicare Advantage plan and have been considering a switch to a Medicare Supplement (Medigap) plan, you’re not alone. The first half of this article answers the crucial questions about making the switch. The second half explains medical underwriting, the step that trips up the most people.
Can I switch from Medicare Advantage to Medicare Supplement?
Yes, you can absolutely switch from Medicare Advantage to a Medicare Supplement
plan. However, there are a few key things to keep in mind:
Timing: The best time to make this switch is during the Medicare Annual
Enrollment Period (AEP), which runs from October 15th to December 7th each
year. Any changes you make during this period will take effect on January 1st of
the following year. You can also drop a Medicare Advantage plan and return to
Original Medicare during the Medicare Advantage Open Enrollment Period,
January 1 through March 31.
Underwriting: Unlike Medicare Advantage plans, Medicare Supplement plans
require you to undergo medical underwriting unless you meet the criteria for an
exception. This means the insurance company will review your health history to
determine your eligibility and premium rates. If you have pre-existing health
conditions, you may face higher premiums or even be denied coverage for certain plans. The second half of this article walks through the process.
Guaranteed Issue Rights: There are certain situations where you may have a
guaranteed issue right to a Medigap plan, even if you have pre-existing
conditions. This typically occurs when you lose your current coverage due to
circumstances like your employer group health plan ending or you moving out of
your Medicare Advantage plan’s service area. The full list is below.
What is the advantage of switching from MA to Medigap?
Medicare Supplement plans offer several advantages that appeal to many beneficiaries:
More Predictable Costs: With a Medigap plan, you’ll typically have more
predictable out-of-pocket costs. While premiums may be higher, you’ll have lower copays, coinsurance, and deductibles when you receive care. This can offer greater peace of mind, especially if you have significant healthcare needs.
Medicare Supplement premiums are usually raised each year, but one of the key
benefits over Medicare Advantage is that you won’t lose any benefits or coverage year-to-year.
Greater Provider Choice: Original Medicare paired with a Medicare Supplement
plan gives you the freedom to see any doctor or specialist who accepts
Medicare, anywhere in the country. You’re not limited to a network like you are
with many Medicare Advantage plans.
No Referrals Needed: You won’t need referrals to see specialists with Original
Medicare and a Medigap plan. This can simplify the process of getting the care
you need.
Can I have both Medicare Advantage and Medicare Supplement?
No, you cannot have both a Medicare Advantage plan and a Medicare Supplement plan at the same time. You’ll need to choose one or the other.
Pros and Cons of Switching from Medicare Advantage to Medigap
Pros:
Predictable Costs
Greater Provider Choice
No Referrals Needed
Coverage Nationwide
Cons:Higher Monthly Premiums
Medical Underwriting
May Need to Purchase a Separate Part D Drug Plan
Medigap Underwriting: What to Expect
The phrase “medical underwriting” might sound daunting, especially when you’re
researching Medigap plans. Whether you’re aging into Medicare, switching from a
Medicare Advantage plan, or experiencing a qualifying life event, understanding this
process is key. Here is what Medigap underwriting means, why it’s important, and how it could affect your plan options.
Why Medical Underwriting Matters
Medigap, also known as Medicare Supplement Insurance, helps fill the “gaps” in Original Medicare (Parts A and B) coverage. It helps pay for out-of-pocket costs like deductibles, copayments, and coinsurance, providing valuable financial protection.
However, unlike Original Medicare, Medigap plans are offered by private insurance
companies, and these companies use a process called medical underwriting to assess your health risk before offering you a policy. The medical underwriting process helps them determine your premium costs or even your eligibility for coverage.
Understanding Medigap underwriting is crucial because:
It affects your premium: Your health status can significantly influence how much
you pay for a Medigap plan.
It can impact your eligibility: In some cases, you might be denied coverage
altogether due to pre-existing health conditions.
It helps you make informed decisions: Knowing the process of underwriting helps you choose the right plan for you at the right time.
Medigap Open Enrollment: Your Guaranteed Issue Window
“Best” is a subjective term, but there’s not a debate here: The best time to enroll in a
Medigap plan is during your Medigap Open Enrollment Period. This is a one-time,
six-month window that starts when you turn 65 and are enrolled in Medicare Part B.
During this period, you have guaranteed issue rights, which means:
No medical underwriting: Insurance companies cannot deny you coverage or
charge you higher premiums based on your health status.
More plan choices: You have access to all Medigap plans available in your state.
Important Note: If you’re switching from Medicare Advantage to Medigap, you typically do not have guaranteed issue rights outside of the specific circumstances listed below.
What Underwriting Involves
Outside of your Medigap Open Enrollment Period, you’ll likely face medical underwriting when applying for a Medigap plan. This process typically involves:
Health questionnaire: You’ll be asked questions about your medical history,
current health conditions, and medications.
Medical records review: The insurance company may request access to your
medical records to verify the information you provide.
Medical exam: In some cases, you may be required to undergo a physical exam.
Based on the underwriting assessment, the insurance company can:
Approve your application: Offer you the Medigap plan at the standard premium
rate.
Approve with a higher premium: Offer you the plan, but at a higher cost due to
your health risks.
Deny your application: Refuse to offer you coverage due to your health status. This is often referred to as a “Health Knockout.”
According to the Kaiser Family Foundation, the list of “potentially deniable medical conditions” includes:
Alzheimer’s disease
Asthma
Cancer
Congestive heart failure
Diabetes with complications
End-stage renal disease (ESRD)
High blood pressure
Limitations of daily activities
Stroke
(Some of these conditions, however, may potentially qualify you for a Medicare
Advantage Chronic Condition Special Needs Plan.)
What About The Affordable Care Act and Pre-Existing Conditions?
This might sound strange, as the Affordable Care Act (colloquially known as
“Obamacare”) does not allow insurers to deny coverage or increase premiums based on pre-existing conditions. However, these protections do not apply to Medicare
Supplement plans.
Guaranteed Issue Rights: When Underwriting is Waived
Even outside your open enrollment period, there are certain situations where you have guaranteed issue rights and cannot be denied Medigap coverage or charged higher premiums due to your health. These situations include:
Loss of creditable coverage: If you lose coverage from an employer, union, or
other source that’s considered “creditable,” you have the right to buy a Medigap
plan.
Medicare Advantage trial period: If you join a Medicare Advantage plan when first eligible for Medicare and decide to switch back to Original Medicare within the first year, you have guaranteed issue rights.
Medicare Advantage plan issues: If your Medicare Advantage plan leaves
Medicare, stops providing services in your area, or you move out of their service
area, you have guaranteed issue rights.
Medigap plan issues: If your Medigap insurer goes bankrupt or your coverage ends for reasons outside your control, you have guaranteed issue rights.
Medicare Advantage plan misconduct: If you leave your Medicare Advantage
plan due to the company not following rules or misleading you, you have guaranteed issue rights.
If you’re looking for a full list of situations that may afford you guaranteed issue rights, Medicare.gov has a short survey that gives you an answer.
Tips for Getting Through Underwriting
If you’re facing Medigap underwriting, here are some tips to increase your chances of approval:
Be prepared: Collect your medical record. This should include dates of
diagnoses, treatments, and medications.
Be thorough: Answer all health questions honestly and completely. Don’t leave
anything blank or say “I don’t know” if you can avoid it.
Be proactive: If you have any pending medical procedures or tests, consider
completing them before applying for Medigap.
Be honest: Disclose all health conditions and medications, even if you think they
might be disqualifying.
While some conditions might make it more challenging to get approved, it’s always
worth applying. Insurance companies have some flexibility, and you might qualify for a plan even with pre-existing conditions. If you’re curious what you may be asked, insurers publish the health questions in their Medigap applications, so you can preview them before you apply.
Denied Coverage? You Have Options
If your Medigap application is denied, it doesn’t mean your options are over. Here are
some steps you can take:
Appeal the decision: Each insurer has an appeal process. Contact them to learn
more.
Contact Medicare: Call 1-800-MEDICARE (800-633-4227) for assistance.
Seek help from SHIP: Your State Health Insurance Assistance Program (SHIP)
offers free, unbiased counseling on Medicare and Medigap issues.
Consider alternatives: Explore other options like Medicare Advantage plans, but
be aware of their differences from Medigap plans (networks, prior authorizations,
etc.).
Where to get help: This can be a difficult process. Licensed insurance agents at
SmartConnect can help you explore options if you’re denied coverage, whether you
applied through another agent or on your own.
State-Specific Underwriting Considerations
It’s important to note that Medigap regulations can vary from state to state. Some
states have more generous guaranteed issue rights or offer additional protections for
consumers. One of the clearest examples is the Birthday Rule, which a number of states use to provide guaranteed issue rights around a beneficiary’s birthday.
To learn more about the rules in your state, contact your state insurance department or SHIP.
Making the Decision on Switching Plans
The decision to switch from Medicare Advantage to Medicare Supplement is a personal one. Carefully weigh the pros and cons based on your individual health needs, financial situation, and preferences. It’s also a good idea to compare plans and get quotes from different insurance companies. Remember these key points:
Mind the calendar: Switch during the Annual Enrollment Period or the Medicare
Advantage Open Enrollment Period.
Medigap Open Enrollment is key: If you’re new to Medicare, take advantage of
your guaranteed issue rights during this time.
Know your rights: Understand when you have guaranteed issue rights outside of
open enrollment.
Be prepared for underwriting: Gather your medical information and be honest in
your application.
Don’t give up: If you’re denied coverage, explore your options and seek help from
resources like SHIP or a trusted licensed insurance agent.
By being proactive and informed, you can navigate the switch with confidence and find the plan that best meets your needs and budget.