Buying Medicare Supplement Insurance
3 things to know about buying a Medigap policy:
- You should buy a policy during your 6-month Medigap open enrollment period.
- If you don’t buy during your enrollment period, you could have trouble finding a policy.
- If you are outside of your Medigap open enrollment period, there are some situations where you have guaranteed access to a policy.
Buying a Medigap policy is a smart way to get coverage for the out-of-pocket costs not covered by Original Medicare (Medicare Parts A & B). If you’re not sure whether you’re eligible to buy a Medicare Supplement insurance policy, read our eligibility page. If you’re eligible and planning on purchasing a policy, you should do it during your Medigap open enrollment period. If you buy during this period, “you can buy any Medigap policy the company sells, even if you have health problems, for the same price as people with good health,” according to Medicare.gov. However, there are certain circumstances when you can buy outside of your open enrollment period with the same protections you’d have during the open enrollment period. These are called guarantee issue and trial rights. Your Medicare Supplement insurance open enrollment period is different from Original Medicare open enrollment. Keep reading for details.
Buying during open enrollment
Your Medigap open enrollment period last for 6 months and starts the day you are both 1) 65 years old and 2) enrolled in Original Medicare (both Parts A & B). If you only bought Part A when you turned 65, the 6-month period starts the day you buy Part B.
Why buy during open enrollment? During this period, you have the following guarantees:
- Insurers cannot deny you coverage.
- Insurers cannot increase prices due to health issues.
- You are able to switch plans within your 6-month open enrollment period.
- You do not have to wait for coverage to begin.
Companies must sell you a policy during open enrollment. They cannot deny you coverage, and they cannot raise your prices because of past health problems. You will get the same price as a healthy person during open enrollment, guaranteed.
If you buy a policy after open enrollment, things can get a little more complicated and expensive.
Buying after open enrollment
Technically, you can still buy Medicare Supplement insurance after your open enrollment period ends, but your health history can affect your options. At this point, it’s not guaranteed that you can buy a policy, and insurers can charge you higher rates because of your health history. That’s because after open enrollment, insurers are allowed to use underwriting to determine your eligibility. Underwriting lets them raise your rates or deny you coverage based on your medical history.
Guaranteed issue and trial rights
However, there are some situations where you can avoid underwriting after open enrollment. You can do so if you have a guaranteed issue right or trial right. These rights let you buy a Medigap policy after enrollment without penalty if:
- You have a Medicare Advantage plan & it’s leaving Medicare or ending coverage in your area.
- You have a Medicare Advantage plan & you are moving out of the plan’s service area.
- You have Original Medicare & you need to replace an employer health plan that will soon discontinue.
- You have Original Medicare and a Medicare SELECT policy & you move out of the policy’s service area.
- You joined an Advantage plan or PACE when you were first eligible for Part A at 65 and within the first year of joining you want to switch to Original Medicare.
- You dropped a Medigap policy to join an Advantage plan for the first time and within the first year of joining you want to switch back to Medigap.
- Your Medigap insurance company goes bankrupt or ends your policy through no fault of your own.
- You leave a Medicare Advantage plan or Medigap policy because the company misled you or didn’t follow the rules.