Medicare Supplemental (Medigap) Benefits

As we grow older, many of us will develop new health problems or conditions. There may be people who start to wonder if their Medigap insurance company can drop them if their medical condition changes because Medigap policies are issued by private insurance companies. The answer to this question depends on several different variables.

First, did you purchase your Medigap policy before 1992 or after 1992?

Medicare supplemental benefits bought before 1992 were not necessarily guaranteed renewable policies. After 1992, Medicare supplemental insurance policies have been guaranteed renewable. Guaranteed renewable policies cannot be dropped by the insurance company, except for special circumstances. If you bought the policy before 1992 and your insurance company terminates your policy, you have a guaranteed right to purchase a new Medigap policy.

Second, have you stayed current in your premium payments?

Even guaranteed renewable Medicare supplemental benefits can be dropped if you do not pay your premium bill each month.

Third, did you lie on your Medigap insurance policy application?

Falsifying your facts on your insurance policy makes you vulnerable to losing your Medicare supplemental benefits.

Fourth, is the insurance company still in business?

If your Medigap insurance company goes belly-up (bankrupt or insolvent), they are not liable to pay your Medicare supplemental benefits simply because they do not have the finds to do so.

Medigap Protections

Medigap protections (also called guaranteed issue rights) are times and conditions during which insurance companies are required to allow you to buy certain types of coverage. Under guaranteed issue rights, the insurance company must cover your existing medical conditions, sell you a Medigap policy, and not charge you more because you have (or have had) a specific medical condition. There is a time limit on the period of Medigap protections of 63 days.

You have the guaranteed issue right to purchase Plans A, B, C, F, K, and L if you are switching from a Medicare Advantage Plan to original Medicare because your plan is no longer a part of Medicare, if you move away from the area in which the plan is available, or if the companies ceases to offer the plan in your area.

You also have Medigap protections when you have had original Medicare that was extended by an employer-supplied group health plan and the group health plan runs out. This includes retiree benefits and COBRA coverage. You can buy policies A, B, C, F, K, and L that are offered in your area.

Another reason you can be granted guaranteed issue rights is if you have had original Medicare and Medicare SELECT and the SELECT plan is no longer offered in your area.

There are also Trial Right situations that allow you to switch to a Medigap policy if you have purchased a Medicare advantage plan or a Medigap SELECT and are unhappy with the Medicare supplemental benefits you receive.

If your insurance company deals falsely with you, misleads you, or breaks the rules, you also fall under the Medigap protections, granting you the ability to purchase any Medigap insurance policy sold in your area. As stated above, you also have guaranteed issue rights when your insurance provider goes bankrupt or is insolvent.

If you think you may have guaranteed issue rights for these or other reasons, it is important to keep good paper records. Keeping copies of communication between yourself and the insurance company (even emails) is a good way to prove that you are eligible for Medigap protections should it become necessary.

Annual Review of Medicare Supplemental Benefits

It can be wise to review your Medicare supplemental benefits each year, to determine if there have been changes that make additional policies necessary. For instance, some people originally bought Medigap insurance that also had a prescription drug coverage section. However, now it might be more affordable and work better for them to have a Medigap policy and a Medicare Part D policy.

Medigap policies are also not necessary when you have a Medicare Advantage Plan. If you are thinking of switching from Medicare Part A and Medicare Part B to a Medicare Part C (Medicare Advantage) Plan, you will need to cancel your Medigap policy.

When you look at the Medigap policies available to you in your state, make sure to shop around for the best price on the standard type of policy you desire to have.