Switching your Medigap plan entails going through an underwriting process. There could be several reasons prompting your desire to change your Medigap plan: your current Medigap plan has experienced multiple rate hikes, you began with Plan F but now see the financial benefits of Plan G, or you might be among the few who missed the open enrollment window for Medigap.
To get a new Medigap plan, you're usually required to complete health screenings and meet certain underwriting criteria. The mere thought of this can induce unease about successfully navigating the Medigap underwriting process. However, we help many beneficiaries clear the underwriting hurdle and succeed in getting a new Medigap plan.
Today, we will talk through a few scenarios that could lead to a successful or unsuccessful application. Afterward, you'll have a good idea of where you stand with Medigap qualification.
Upon turning 65 or activating Part B for the first time, everyone is entitled to an open enrollment period for Medigap. This critical 6-month window allows you to join without undergoing health inquiries. However, it's essential to remember that this opportunity is a once-in-a-lifetime chance.
Nevertheless, there are multiple scenarios where you can obtain a comprehensive Medigap policy bypassing the underwriting process. This privilege is termed "Guaranteed Issue" or simply "GI". Some prevalent GI circumstances include:
Transitioning away from a different insurance, typically from a major corporation's employer coverage, in the past 63 days.
Experimenting with a Medicare Advantage plan for the initial time and deciding within a year to switch back to Medigap.
Being on a Medicare Advantage plan or Medicare Select policy and relocating beyond your plan's service jurisdiction.
For all those scenarios, a brief period is allocated to obtain a Medigap policy without answering any health-related queries.
Certain situations might automatically grant you a GI phase. It's recommended to consult with your insurance representative to ascertain if any of these conditions are relevant to you. Talking with a seasoned agent well-versed in Medicare nuances enhances your chances of identifying scenarios where you may be eligible for GI.
Several states offer unique Medigap Open Enrollment Periods that allow residents to change their policies without underwriting. Here's a rundown:
California, Oregon, and Maryland: If you hold an existing Medigap policy, you're permitted to switch it during your birthday month without any underwriting.
Missouri: Mirroring the birthday rule, Missouri allows you to switch Medigap providers around your policy's anniversary, provided you retain the same coverage level. For instance, moving from Plan G to another Plan G is permissible without underwriting. But switching from a Plan G to a Plan N isn't. This window typically spans from 30 days before to 30 days after your anniversary.
Illinois: Illinois residents aged 65 to 75 can modify their Medigap policy without medical underwriting 45 days post-birthday. However, they can only opt for a policy offering similar or reduced coverage from their existing Medigap provider.
Idaho: With the new birthday rule, enrollees can transition to a Medigap plan of equivalent or lower coverage. This period begins on your birthday and concludes 63 days afterward.
Louisiana: Medigap enrollees aged 65 and above can transition to a different Medigap policy around their birthday without health screening. They have a 45-day post-birthday window.
Nevada: Policyholders can swap their Medigap plan for another with the same or reduced coverage around their birthday without underwriting. This opportunity commences on the first day of their birth month and extends for 60 days.
Continuous Open Enrollment States: States like Connecticut, Maine, Massachusetts, New York, Vermont (select providers), and Washington provide year-round Medigap Open Enrollment. However, specific conditions apply, so if you live in one of those states, you’ll need to read more about your state for details.
Having shed light on the GI scenarios, let's pivot to the methodology insurance firms employ for underwriting. Each Medigap insurance provider has a distinctive application, which invariably incorporates a series of health-related inquiries.
These questions can be categorized into two types:
Questions regarding any lifetime instances of specific conditions.
Questions probing your health history over a defined recent period, often the preceding two years.
To qualify, you generally need to respond 'NO' to some or all of the health queries stipulated in the application. A ‘YES’ response to any of these questions usually translates to an instantaneous rejection by most providers. In such instances, you're deemed ineligible for the coverage, rendering the application submission redundant. However, exceptions might exist in certain regions owing to specific state regulations. Thus, conferring with your insurance agent about potential exceptions or alternative avenues is always helpful.
A silver lining amidst this rigorous scrutiny is that, based on our agency's observations, around 75% or even more of all applications subjected to underwriting get the green light. Let’s talk about some health conditions you might encounter on the application.
Medigap health questions typically bypass minor health concerns like seasonal allergies, the flu, or occasional colds. Issues like high blood pressure or cholesterol aren't problematic unless coupled with a graver condition. While minor arthritis is acceptable, rheumatoid arthritis may lead to a declined application. Medigap plans tend to be more lenient about Body Mass Index (BMI) compared to other insurances. Being slightly overweight isn't concerning unless one is severely obese. Agents can cross-check your height and weight against a company's criteria to ensure application success.
Insurance carriers are hesitant about covering upcoming expensive procedures. They're wary of bearing surgery costs, especially since Medigap carriers handle 20% of those expenses. Even for non-life-threatening surgeries, like gall bladder removal, carriers prefer the procedure to be finished under your current insurer. Post major surgeries like knee replacements, some carriers may require a waiting period of a year or more before considering your application.
Medigap carriers also look at recent significant health events. Frequent hospitalizations, home health care, or residence in a nursing home often lead to application declines. Once in assisted living, changing coverage can be challenging. Concerning cancer, carriers typically require a 2-year remission period before considering an application. While some carriers may offer coverage to those with major health conditions, they often impose higher rates. Sometimes, sticking with your current plan can be more economical than switching to a higher-priced option due to health conditions.
Certain chronic illnesses often result in Medigap application exclusions. Conditions like dementia, chronic lung disorders, immune disorders including RA, MS, Lupus, or AIDS, and nervous system disorders like Parkinson’s are typically grounds for denial. Osteoporosis with fractures can also be a concern. The carriers anticipate high lifelong costs for these conditions. Additionally, major heart issues, vascular diseases, a history of heart attacks or strokes, and kidney failures can pose barriers to changing carriers.
Medigap carriers utilize national prescription records to assess your health conditions. By granting access to your prescription history on the application, carriers evaluate medications that could signify serious health issues. A key aspect is the honesty and accuracy of the provided information. For instance, if there's a medication related to lupus in your records, but you didn't list lupus on your application, it raises concerns for the carrier.
Many carriers have specific auto-decline medications, typically associated with chronic or severe illnesses. By their nature, these prescriptions suggest the presence of conditions that could entail significant medical expenses for the insurer. The mix and history of medications can also play a pivotal role. For instance, if you're on medications for diabetes, high blood pressure, and cholesterol, their combination, and recent dosage changes can impact your application.
Lastly, chronic usage of pain medications, such as hydrocodone, fentanyl, or oxycodone, can be red flags, suggesting unresolved and potentially expensive health issues.
Does this process sound a bit complicated? If so, you’re not wrong in thinking that. Switching your Medigap plan can be time-consuming if you try to do it alone. Our advisors can help you through the Medigap underwriting process and tell you if we think your application might get denied.
For expert help with your Medicare plans, call Local Medicare Specialists today.
Schedule a FREE Medicare plan consultation with an agent in your neighborhood.
LocalMedicareSpecialists.com is privately owned and operated by LMS Insurance LLC. LocalMedicareSpecialists.com is a non-government resource for those who depend on Medicare, providing Medicare information in a simple and straightforward way.
We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area which are United Healthcare, Aetna, Humana, Cigna, Blue Cross Blue Shield of Arizona, Centene, Devoted, and Scan. Please contact Medicare.gov, 1-800-MEDICARE, or your local State Health Insurance Program to get information on all of your options.