Medicare Supplement Application – Three Things Not to Do

Applying for a Medicare Supplement plan is a relatively easy thing to do. It should not be made more difficult than it is, particularly if you are in open enrollment or guaranteed issue, during which you cannot be made to disclose medical information or answer medical questions. There are, of course, a few things that you should make sure not to do when you are applying for a Medicare Supplement plan. These will prevent future rescission of your policy or problems with claims in the future when you most need your policy.

  1. This should go without saying, of course, but it needs to be said. Do not be dishonest on your Medicare Supplement application. Of course, you shouldn’t be dishonest other times either, but that’s up to your own morality! I’m just concerned with the negative consequences that being dishonest on a Medicare Supplement application could/would have on you, your insurance, your family, your agent, etc. In most cases, there are medical questions on the application. Sometimes, there are terms that are not familiar to you, because they are medical terms. If you do not know if one of the terms applies to you, usually an agent can answer the question for you. Or, you can contact your doctor to find out the answer.
  2. Do not leave required information out. Some information is “required” because of just that – it has to be received in order for a company to process your application. There are some fields on most applications that are not required. However, the bulk of the information, if it is on there, is required and is necessary to process your application. Not a week goes by when someone tells me that they want to pay by monthly bank draft but don’t want the company to have their bank information or they want to link their supplement policy with their Medicare but they don’t want to give the supplement company their Medicare number. While I can certainly appreciate the need for security and privacy, it is sometimes necessary to divulge to the company enough information to serve you properly.
  3. Do not apply for multiple Medicare Supplement plans. So many people think this is a good idea, but it is simply not. You should apply for one Medigap plan only. First off, you only need one, and you cannot have more than one. Also, an agent cannot sell you one if you do not intend to replace one that you have currently. They cannot knowingly sell you two Medigap plans – this is for your protection. Sometimes, people do this because they are afraid they will not get approved for the plan. However, you should apply for the first plan, wait to see if it gets approved, then apply for a second option if it does not get approved.

Completing a Medicare Supplement application is not as difficult as many other types of applications. It is advisable to use an agent or broker when you are completing one, so that they can clarify any questions and help you submit the application properly. Whether it is us or someone else, we recommend having an agent’s free services on your side. If you have questions or need help getting a plan lined up, please visit our website or call us at 877.506.3378.

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

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.

The Prerequisites for Having a Medicare Supplement Plan

There are several significant prerequisites that must be in place before you are eligible for a Medicare Supplement plan. Take note to understand these and make sure you have them taken care of before you begin the processing of enrolling in a Medicare Supplement plan.

  1. First and foremost, you must live in the area in which the plan you are signing up for is offered. Medicare Supplements vary by zip code (different companies over plans in different areas). So, just because you have heard of someone in a different place having a plan, that does not necessarily mean that the plan is offered in your area. You must make sure you live in an area in which your plan is offered and available.
  2. Secondly, you must have both parts of Medicare – Part A and Part B. Typically, everyone gets Part A the first day of the month that you turn 65. You will receive a Medicare card 2-3 months in advance of this date, signifying that you are in Medicare’s records and that your Medicare benefits will be starting soon. If you are already receiving Social Security at that time, you will also be enrolled in Part B typically. So, you’ll receive a card and information in the mail signifying that you are in both parts of Medicare. If you, for some reason, do not wish to take Part B (usually if you are still covered through an employer or still working), you will have to contact Medicare to delay Part B. In order to be eligible for a Medicare Supplement, you MUST have both parts of Medicare – Part A and Part B – at the time the Medigap plan takes effect. This does not mean that you must wait to sign up for a Medigap until after your Medicare starts. Most companies give you 6 months prior to your 65th birthday in order to sign up for a plan. You should use this time to sign up for a plan, in order to have everything in place at the time your Medicare starts.

Getting a Medigap plan is an important part of going on Medicare. It is important to compare the plans, understand them, and choose wisely. If you want a comparative quote from Medicare-Supplement.us of available plan in your area, please contact us on our website or call us at 877.506.3378.

When is the Medigap Enrollment Period – How and When to Change Plans

Medigap plans are plans that are designed to work with Medicare Parts A & B. These plans are sold through private insurance companies. It is important to understand how these plans work, and there are many very common misconceptions out there about the plans.

First and foremost, many people mistakenly think that there is an annual Medicare Supplement/Medigap open enrollment period. This is simply not true. This misconception is fueled by the fact that Medicare ADVANTAGE plans (which are NOT Medicare Supplements) and Medicare Part D plans (Rx coverage) do have an annual enrollment period. The enrollment period for these plans runs from October 15 to December 7 each year. During that time, you can change plans, enroll in a plan, or disenroll from a plan.

Medicare Supplement plans, on the other hand, do not have such a period. On the contrary, you can enroll in or disenroll from a plan at any time. There are no set times of the year for enrolling in, or changing, your Medicare Supplement coverage.

There is an initial open enrollment period, the terminology of which also adds to the confusion. This initial open enrollment period applies when you first turn 65 or go on Medicare. During this time, you have 6 months to sign up for a plan without medical underwriting, pre-existing conditions etc. After that initial period, you can change plans at any time (and should if you can save money by doing so) but you do have to qualify medically to do it.

So, now that you understand that you can change plans at any time, how do you do it? If your Medigap rate has gone up, it is a good time to re-evaluate your plan and make sure you have the best “deal” available. Because the plans are standardized, it is important, on a regular basis, to compare Medigap rates and switch plans if you can save money by doing so.

If you find a plan that would be less expensive for you, you can apply for the new plan for a future effective date. Once the new plan is approved, you would simply cancel your old plan, effective the date that the new plan starts. This is how you easily and effectively switch Medigap plans. This can result in hundreds, in some cases thousands, of dollars in savings per year.

If you have any questions or would like to speak more about Medigap plan options or how and when you can change plans, you can call us at 877.506.3378 or visit our website at: Medicare-Supplement.US.

What is the California “Birthday Rule”?

The California “birthday rule” is an annual “open enrollment” period available to California residents during which they can change their Medicare Supplement plans. This open enrollment period is specific to CA residents – most other states don’t have this stipulation.

Below, I’ve listed some important criteria/things to remember about the CA “birthday rule” and how it works:

  • To be eligible to use this open enrollment period, you must already have a Medigap plan.
  • You can switch to another plan, as long as it is of equal of lesser coverage level. In other words, if you have Plan F (the top level of coverage), you can switch to any plan with any company. If you have one of the lower level plans (Plan N, for example), you would have to stay with the plan that you have. NOTE: This is somewhat more of an incentive to take a higher level plan when you are first eligible for Medicare, as it could be difficult to go “up” in coverage later.
  • Keep in mind that you can change Medigap plans at any time of the year. There is not a restriction on WHEN you can change, just HOW the change takes place. If you change outside of your “birthday rule” open enrollment, you would have to qualify medically (i.e. answer medical questions, etc.). During the annual “birthday rule” open enrollment, though, you do NOT have to answer medical questions when you change plans.
  • The time period for this annual open enrollment period is 30 days following your birthday. So you can apply at any time (up to 30 days) leading up to your birthday extending through 30 days after your birthday, but the policy must take effect on your birthday or in the 30 days after your birthday.

To reiterate, this “birthday rule” is specific to California residents and existing Medicare Supplement policyholders. For more information about California Medicare Supplement plans, visit California Medigap or call us at 877.506.3378.

Medicare Co-Pays and Deductible for 2012

The Medicare co-pays and deductibles for 2012 were announced last week and there have been some relatively noteworthy changes that you should be apprised of. First of all, it is important to note that these co-pays and deductibles do NOT directly affect you if you have a Medigap plans that pays the Medicare co-pays and deductibles OR if you have a Medicare Advantage plan that replaces Medicare A & B.

However, if you are on ONLY “original” Medicare A & B, the following are the co-pays and deductibles that you would pay for 2012. NOTE: this information is also available at Medicare.gov.

PART A

  • Part A Deductible = $1156 per benefit period
  • Part A Premium = $451/month (this only applies to people who have not qualified for Part A entitlement through work during your lifetime
  • $289/day for days 61-90 of each benefit period
  • $144.50/day for days 21-100 of each benefit period

PART B

  • Part B Deductible = $140/year
  • Part B Premium = $99.90/month. You may pay more if you exceed $85,000/year in annual income.
  • Part B Coinsurance = 20% of the Medicare-approved amount for covered services
  • Part B Coinsurance = 40% for mental health coinsurance for Medicare-approved covered services

Overall, some of these changes, in particular the Part B deductible and premium, are definitely a welcome sight for Medicare-eligible individuals. The Part B deductible in 2011 is $162/year so it is going down by $22/year for 2012.

The effects that this information will have on a Medigap insurance remains to be seen. It can be expected that the claims ratios on Plan F’s would be smaller than in year’s past since that gap (which ‘F’ covers) is smaller. This may help keep ‘F’ premium rates more stable with some insurers. In the past, Plan G, which doesn’t cover the Part B deductible, has been the more rate-stable choice over time. This change may level off rate stability on ‘G’ and ‘F’.

To get updated information about Medicare Supplement rates for 2012, you can contact us at 877.506.3378 or visit our website to request this information by email. To get the information by email, go to 2012 Medicare Supplement prices.