Ask the Medicare Specialist

QUESTION:

Question from Debbie: I turn 65 in April and was most likely going to choose Supplement Plan N. You surprised me in the last column by saying N isn’t available without going through Medical Underwriting. I thought I didn’t have to worry about that during my Initial Enrollment Period. Are you saying my rates may possibly be higher and/or can I be refused?

Question from Bryan: My wife and I are approaching age 70 and have been enrolled in a Supplement plan since we were eligible for Medicare. I’m very healthy, but my wife takes insulin, and I was told she could never move to another carrier because of this. But I just read that during the Medigap Open Enrollment Period, carriers cannot deny coverage or charge more in monthly premiums due to pre-existing health conditions. Premiums for our Mutual of Omaha plan G have increased substantially. Could she switch to another carrier who may offer a lower cost during this Open Enrollment period without being denied, and if so, when does this

period begin?

ANSWER:

These are two similar and related questions I received since the last column which I wanted to answer today. What we have here is the semantics of Medicare. Both the Initial Election and Open Enrollment Periods occur when one first goes on both Medicare Parts A and B, or Part B at a later date than A. Initial Election refers to one’s opportunity to enroll in an Advantage Plan or a StandAlone Part D. It starts three months prior to the Medicare effective date and runs through the month of the effective date as well as the three months after. Open Enrollment, what Debbie will be in when she turns 65, refers to the six-month period that starts from one’s Medicare Part B effective date. This is the best time to choose a Supplement (Medigap) policy because for the vast majority, it’s the one and only time when Supplement companies must accept everyone into any letter plan they offer, regardless of current or previous health.

Debbie, my apologies If I wasn’t clear last week. Those who are new to Medicare Part B can indeed enroll in Plan N, or any other letter for that matter, at the “preferred” rate without having their current or past medical history considered, the process known as Medical Underwriting. What I stated in the column was there are two exceptions where people can enroll in a Supplement at a later date without going through underwriting: A) Moving to a Supplement within 12 months of the enrollment in an Advantage Plan if that was one’s first choice after getting Part B. B) Those who receive Medicare prior to turning 65 due to being awarded Social Security/Disability. The latter group gets a second Open Enrollment and can choose any plan when they turn 65. The former, except for only one company that I know of, cannot choose Plan N without going through underwriting. But let me make this clear one more time; Everyone going on Part B for the first time, be that turning 65 like Debbie, those who wait until after 65 to go on Part B because they were getting insurance through their own or a spouse’s employer, and those who get Medicare pre-65 can choose any letter plan from any company that sells Supplements, no questions asked.

Bryan, unfortunately, you misunderstood the “open” part of the Medigap Open Enrollment Period. There’s no period of time every year where those on Medicare can move from one Supplement company or plan to another without going through underwriting. This is why I write over and over that the choice those who are new to Medicare make is one of the most important of their lives. That being said, whoever told Bryan his wife could never enroll in another Medigap policy gave him bad information. The licensed agents at The Health Insurance Store, including myself, are well versed and trained in the rules, regulations, intricacies, and exceptions when it comes to Medicare Supplements, Part D, and Advantage Plans. No offense, but the fact is far too many agents aren’t, which is why it’s also very important for those going on Medicare Part B for the first time or those considering making a change in plans to consult us on the facts and many differences between Medicare Supplements and Advantage Plans. Wellchosen Advantage Plans cost significantly less and offer many benefits that Supplements don’t. However, they do come with a couple of risks people need to be aware of before making a choice. Our agents are appointed to provide plans from every competitive Supplement and Advantage company in the market. So, no matter your preference after learning about both, we guide our clients to the plan(s) that offer the best possible value for their needs and ensure that’s the case each and every year.

Although the majority of Supplement companies will not accept insulin dependent diabetics, there is one reliable and stable company who does. You see, not all Supplement companies have the same criteria to determine who they accept. We write all our Supplement business with four companies who have an excellent history of keeping rates steady over time. None asks the same medical questions or looks back as far into one’s history as another. I actually quoted Bryan a price for his wife on Plan N that would save her $780 per year. Bryan is healthy and a move to Plan N, with a different and least expensive company in his zip code, will save him over $1,200. Combined, that’s $2,000 less premiums per year and the only additional bills they would be responsible for are $20 for a physician’s office visit and $50 at the ER.

The company they’re with now, obviously, is not one of the four we use. I’m going to repeat myself again and I’m sorry for those who are tired of reading it. If you didn’t purchase your Supplement through The Health Insurance Store, there’s a very good chance you’re overpaying, on the wrong letter plan, or both. Plan G is no longer the smart choice. Bryan, for example, not yet 70, is paying twice as much for G as he would N, over $200 per month vs $95. I’m encouraging everyone on Plans G (or F) to reach out and get a quote. Don’t assume you won’t pass underwriting and don’t let the unsubstantiated fear that you may get expensive medical bills on N that you wouldn’t with G keep you paying too much. It can’t and won’t happen. The deductibles for both plans G and N are identical. The only difference in coverage is those two small copays, which aren’t paid when physical therapy, blood work, other tests such as X-Ray or scans, surgeries etc., are needed.

For an appointment or questions regarding this column or any other Medicare, health, or Life insurance topic give us a call. If you would like to submit a question for a future column or reach me personally, please send an email to aaron@getyourbestplan.com.