There are two types of coverage that you can purchase to go with Medicare – a Medicare Advantage plan or a Medigap plan. The two plan types are very different and attract different consumers. Overall, though, you have to choose the plan that is right for you and your finances and health. Often, people that choose Medicare Advantage initially wish to change to a Medigap plan at a later time. So, is it a possibility to switch from a Medicare Advantage plan to a Medigap plan? If so, how do you go about doing so?
First off, let’s establish that there are several instances in which you are “guaranteed issue” to go from a Medicare Advantage plan to a Medigap plan. The most common of these instances are that you are on a plan that is “non-renewing”. Medicare Advantage plans come and go each year, and in the last few years, there has been a drastic pullback out of the Advantage plan market by some of the larger insurance companies. When this happens, the consumer receives a notice in September or October stating that their plan will not be offered the following year. You can use this notice to obtain a Medigap plan on a “guaranteed issue” basis – in other words, you cannot be turned down for coverage based on pre-existing conditions.
The second common situation that would grant you “guaranteed issue” when going from an Advantage plan to a Medigap plan is if/when you move out of your plan’s service area. Medicare Advantage plans are based on a region or county, typically, so when you move to a new state, you are (in most cases) moving out of your plan’s service area. When you change your address with your plan, they will send you a notice saying that you are “guaranteed issue” into a Medigap plan. This often occurs when someone from the Northeast U.S. (where Advantage plans are more prevalent) moves South (where there are fewer Advantage plan options).
If you do not fall into one of those two situations, or one of several other less common qualifiers, and you wish to change from an Advantage plan to a Medigap plan, there are a few things that you need to know. First of all, you can only get “out” of a Medicare Advantage during a valid enrollment period – either the AEP (Annual Election Period) which runs October 15-December 7 OR the MADP (Medicare Advantage Disenrollment Period) which runs January 1-February 14.
When you leave an Advantage plan to return to Medicare with a Medigap plan, you do have to qualify medically by answering health questions in most states. So it is crucial to have an understanding of whether you would “qualify” before pursuing this change. Different companies screen for different pre-existing conditions, so the health questions vary from company to company and state to state.
Once you confirm that you can obtain a Medigap plan, you can sign up for a Part D plan which will terminate your Medicare Advantage plan. If you sign up during the October 15-December 7 AEP, the changeover effective date will be 1/1/14. So, you can, at that point, set up a Medigap plan to take effect that same date so there is no gap or overlap in coverage.
Changing insurance can be intimidating or overwhelming, particularly if you don’t understand the ramifications of when you can do it and how it works. Regardless of who it is, it is strongly recommended that you use an independent broker that can explain how the process works, ensure you don’t get caught without coverage, and “shop” rates with the Medigap companies on your behalf at no charge to you.
If you have questions about this information or want to discuss your situation, you can contact us at 877.506.3378 or online at Medicare-Supplement.us.