Qualifying for a Medigap Plan – When and How Do Medigap Companies Use Underwriting?

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Qualifying for a Medigap plan is extremely easy to do when you are in a valid open enrollment (When Is the Medicare Open Enrollment Period?) or guaranteed issue period. During these time periods, there is no underwriting, no pre-existing condition restrictions or exclusions, and there is not a possibility of a company turning you down for coverage based on your health. However, when you are NOT in one of these enrollment periods, you do have to qualify medically by answering medical questions on the application. So what does that mean for you?

First of all, do not be intimidated by this. Although you do have to go through underwriting and many people have heard horror stories about medical underwriting and having to pay higher rates based on pre-existing conditions, this is not usually the case with Medigap plans. In almost all cases, Medigap plans are accept/decline applications, meaning that everyone pays the same rate. And, if you go through underwriting, you are either approved or declined based on your health.

The 2nd point to understand is that the underwriting varies greatly from company to company. Some companies use very limited underwriting, accepting nearly everyone who applies and is not currently in the hospital. Other companies are more stringent on underwriting. Obviously, it stands to reason that the more stringent a company is on underwriting, the more likely they are to be rate-stable over time (i.e. on average, if a company has healthier insureds, they will have fewer, or smaller, rate increases). Some of the major things that the more stringent companies ask about on Medigap applications are: insulin-dependent diabetes, cancer (usually last 2 or 5 years), heart attack/stroke (last 2 or 5 years), dementia/alzheimer’s, recent hospitalizations (number and frequency varies by company). This is certainly just a partial list – the things that companies ask about varies greatly and their “lookback” period can vary a good bit.

If you do have some pre-existing conditions and are comparing Medigap plans, it is highly advisable to use a broker who is familiar with the various underwriting practices of the different companies. This will allow you to compare the plans and have the experience and knowledge of a broker who can advise you on which companies would be your best options for getting approved.

Keep in mind, too, that when you are applying for an underwritten Medigap plan (this means when you are applying outside of an open enrollment or guaranteed issue period), you should allow a month for the underwriting process to be complete. It usually does not take nearly this long, but it can. So you want to allow enough time. Also, make sure you do not cancel your current coverage until you have confirmation from the agent or the company that the new plan is approved.

If you have a unique health situation or a question about whether you would qualify for a Medigap plan, please contact us online or call us at 877.506.3378.


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