Americans with certain disabilities or who are age 65 or older qualify for Medicare health insurance. Different plans are available under the Medicare umbrella, offering varying levels of coverage. Medicare Part A is provided to anyone who reaches age 65, but it only covers nursing home care and hospitalization. To cover other medical services, including doctor's visits and drugs, Medicare recipients need to buy supplemental insurance.
Medigap Policy Standards
Federal and state laws govern Medicare supplemental insurance, creating standardized policies identifiable by a specific letter (A through N). These policies offer standard benefits regardless of the insurance company from which they originate. The only variable consumers should encounter when they shop for Medigap coverage between insurance carriers is price.
At publication, Massachusetts, Minnesota and Wisconsin offer Medigap policies that are exceptions to the standardized Medigap policies of every other state. Residents of these states should contact their state insurance department to learn about the special standardized Medigap policies available.
Some states offer a special Medigap policy called “Medicare SELECT.” Policyholders must use specific hospitals and a network of specific physicians to receive covered medical care. Medicare SELECT policies are often less expensive than other policies because of the limitations. Policyholders who receive medical care from hospitals or physicians outside of the SELECT network will be responsible for charges incurred after original Medicare pays its share of the charges.
Medigap Open Enrollment
The open enrollment period for Medigap policies lasts for six months from the first day of the month of the applicant's 65th birthday -- this coincides with Medicare Part B eligibility. During open enrollment, insurance companies cannot deny eligible consumers a Medigap policy. In addition, insurance companies cannot charge higher premiums for past or pre-existing medical conditions. Check with your state to learn about additional open enrollment periods that may be available.
When consumers enroll in a Medigap policy during open enrollment, the insurance company cannot deny coverage of pre-existing conditions. However, the insurance company may stipulate that it will not cover out-of-pocket expenses related to the pre-existing condition for up to six months from the start of enrollment. After the pre-existing condition waiting period lapses, full coverage should begin.
Medigap policyholders have guaranteed renewable policies as long as they pay timely premiums. Insurance companies cannot cancel policies even for policyholders with health issues. Medigap protections -- called “guaranteed issue rights” -- protect consumers from denial of Medigap policies in some situations. If policyholders lose current coverage or move out of a policy service area (for Medicare SELECT), the guaranteed issue right ensures the ability to purchase a Medigap policy.
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