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Medicare Supplement Policies

Medicare Supplement Policies

Medicare Supplement Policies

Medicare Supplement policies are designed to help pay for health care costs not paid by Medicare, including deductibles and co-insurance. The following is important to know about Medicare Supplement policies:

  • They are often referred to as “Medigap” policies.

  • They only cover one person. Spouses are responsible for obtaining their own coverage.

  • The insured is responsible for paying the monthly premium.

  • The policy is guaranteed renewable.

  • The policy can be terminated only for nonpayment of premium or material misrepresentation. A material misrepresentation means you intentionally answered a question incorrectly on the application, and if the insurer would have known the correct answer, you would have been ineligible for the insurance plan or the plan would have been issued to you at a different premium.

What You Should Know

  • The best time to purchase a Medicare Supplement policy is during your open enrollment period.

    Your open enrollment period begins on the first day of the month in which you are both age 65 or older AND enrolled in Medicare Part B. This period lasts six months, during which you can purchase any Medicare Supplement plan, even if you have a pre-existing health condition.

    If you apply for a Medicare Supplement policy after your six-month open enrollment period, you are subjected to the insurer’s medical underwriting criteria and may be denied and/or rated based on your health conditions.

  • You may be able to purchase a Medicare supplement policy with guarantee issue rights when you have other health coverage, including Medicare Advantage or a Medicare supplement policy, that changes in some way (such as when you involuntarily lose coverage). If you qualify for guarantee issue rights, you have 63 days to apply for new coverage under the standardized Medicare supplement plans A, B, C, F, High Deductible Plan F, K or L.

    Individuals newly eligible for Medicare on or after January 1, 2020:

    Plan C is reassigned as Plan D
    Plan F is reassigned as Plan G
    Plan F with high deductible is reassigned as Plan G with high deductible.

    Please see Medicare Access and CHIP Reauthorization Act of 2015 for additional information related to plan reassignments. For more information regarding guaranteed issue rights, contact DIFS at 877-999-6442 or the Michigan Medicare/Medicaid Assistance Program (MMAP) at 800-803-7174.

  • If you are under the age of 65 your choices of Medicare Supplement policies are generally limited to a Medicare Supplement Plan A or Plan C. There are a limited number of health insurers that must offer Plans A and C to persons under the age of 65. Companies that are required to offer Plans A and C to persons under the age of 65 are allowed to charge those individuals more for the coverage.

    Individuals newly eligible for Medicare on or after January 1, 2020:

    Plan C is reassigned as Plan D.

    Please see Medicare Access and CHIP Reauthorization Act of 2015 for additional information related to plan reassignments.

  • Every Medicare Supplement plan includes the following:

    • Hospitalization: Part A co-insurance plus coverage for 365 additional days after Medicare benefits end

    • Medical Expenses: Part B co-insurance (generally 20 percent of Medicare-approved expenses) for hospital outpatient services

    • Medicare Part A and B blood coverage: first three pints of blood per calendar year

    • Medicare Part A hospice co-insurance

  • Plan A includes only the basic core benefits.

    Plan B includes the basic core benefits and the Medicare Part A deductible.

    Plan C includes:

    • Core benefits
    • Medicare Part A deductible
    • Skilled nursing facility care
    • Medicare Part B deductible
    • Medically necessary emergency care in a foreign country

    Plan D includes:

    • Core benefits
    •  Medicare Part A deductible
    • Skilled nursing facility care
    • Medically necessary emergency care in a foreign country

    Plan F includes:

    • Core benefits
    • Medicare Part A deductible
    • Skilled nursing facility care
    • Medicare Part B deductible
    • 100 percent of Medicare Part B excess charges
    • Medically necessary emergency care in a foreign country

    High Deductible Plan F includes:

    • All Plan F benefits
    • While premiums are typically lower under the high deductible option, the insured is required to pay the deductible before the policy will cover your health claims
    • The deductible for this plan changes annually

    Plan G includes:

    • Core benefits
    • Medicare Part A deductible
    • Skilled nursing facility care
    • 100 percent of Medicare Part B excess charges
    • Medically necessary emergency care in a foreign country

    Plan K includes:

    • Core benefits
    • 50 percent of the cost-sharing for Medicare Part A covered hospice expenses
    • First three pints of blood
    • 50 percent of the Part B co-insurance after meeting the annual deductible
    • Payment of the Part A and B deductibles, co-payments, and co-insurance once the annual out-of-pocket spending limit is met
    • The deductible for this plan changes annually

    Plan L includes:

    • Core benefits
    • 75 percent of the cost-sharing for Medicare Part A covered hospice expense
    • First three pints of blood
    • 75 percent of the Part B co-insurance after meeting the annual deductible
    • 100 percent of the Part A and B deductibles, co-payments and co-insurance, once the annual out-of-pocket spending limit is met.
    • The deductible for this plan changes annually

    Plan M includes:

    • Core benefits
    • 50 percent of the Medicare Part A deductible
    • Skilled nursing facility care
    • Medically necessary emergency care in a foreign country

    Plan N includes:

    • Core benefits
    • Medicare Part A deductible
    • Skilled nursing facility care
    • Medically necessary emergency care in a foreign country
    • 100 percent of the Part B co-insurance, except up to $20 co-payment for office visits and up to $50 for emergency department visits

  • The Medicare Access and Chip Reauthorization Act of 2015 (MACRA) prohibits the sale of Medicare Supplement policies that cover Part B deductibles to individuals newly eligible for Medicare on or after January 1, 2020.

    • Plans C, F, and F with high deductible may not be offered to individuals newly eligible for Medicare on or after January 1, 2020.

    • Plan C is reassigned as Plan D and shall not provide coverage for any portion of the Medicare Part B deductible.

    • Plan F is reassigned as Plan G and shall not provide coverage for any portion of the Medicare Part B deductible.

    • Plan F with high deductible is reassigned as Plan G with high deductible and shall not provide coverage for any portion of the Medicare Part B deductible. The Medicare Part B deductible paid by the insured shall be considered an out-of-pocket expense in meeting the annual high deductible.

    MACRA defines “newly eligible” individuals as anyone who:

    • Attains age 65 on or after January 1, 2020.

    • First becomes eligible for Medicare benefits due to age, disability or end-stage renal disease on or after January 1, 2020.

  • A Medicare Select policy is a Medicare Supplement policy (Plan A through N) that conditions the payment of benefits, in whole or in part, on the use of network providers. Network providers are providers of health care which have entered into a written agreement with an insurer to provide benefits under a Medicare Select policy.

    A Medicare Select policy cannot restrict payment for covered services provided by non-network providers in an emergency or for an unforeseen illness, injury, or a condition where it is not reasonable to obtain such services through a network provider. A Medicare Select insurer must make full and fair disclosure in writing of the provisions, restrictions, and limitations of the Medicare Select policy to the applicant. This disclosure shall include at least all of the following:

    • An outline of coverage sufficient for the applicant to compare the coverage and premiums of the Medicare Select policy with other Medicare Supplement policies offered by the insurer or offered by other insurers

    • A description, including address, phone number, and hours of operation of the network providers, including primary care physicians, specialty physicians, hospitals, and other providers

    • A description of the restricted network provisions, including payments for co-insurance and deductibles, if providers other than network providers are utilized

    • A description of coverage for emergency and urgently needed care and other out-of-service area coverage

    • A description of limitations on referrals to restricted network providers and to other providers

    • A description of the policyholder's rights to purchase any other Medicare Supplement policy or certificate otherwise offered by the insurer

    • A description of the Medicare Select insurer's quality assurance program and grievance procedure

    At your request, under a Medicare Select policy, the health insurer must make available to you the opportunity to purchase a Medicare Supplement policy offered by the insurer that has comparable or lesser benefits that does not contain a restricted network provision. The health insurer shall make the policy available and cannot require evidence of insurability after the Medicare Supplement policy or certificate has been in force for 6 months.

  • The policy is your contract. You are responsible for reading your policy to understand the rights and duties of both you and the insurer.

    If you are not satisfied with your Medicare Supplement policy, you may return it to the insurer within 30 days after you receive the policy to receive a full premium refund.

  • When deciding to replace your existing Medicare Supplement policy with one offered by a different company, do not cancel the current policy until the new policy has been received and reviewed.

    It is your responsibility to understand the benefits of the new contract and decide if you want to keep it. Once your decision has been made, you are responsible for cancelling the old policy.

    Insurance agents selling a Medicare Supplement policy intending to replace an existing Medicare Supplement policy with a different insurer must provide the applicant with a Medicare Supplement coverage replacement notice.

  • When becoming eligible for Medicaid while still enrolled in a Medicare Supplement policy it is important to know the following:

    • Benefits and premiums under a Medicare Supplement policy can be suspended at the insured’s request for a period not to exceed 24 months.

    • The insured must notify the insurer within 90 days of becoming eligible for Medicaid.

    • The insurer must refund the portion of the premium attributable to the period of Medicaid eligibility, subject to an adjustment for paid claims.

    • If you lose your entitlement to Medicaid, the Medicare Supplement policy should be automatically reinstated as of the date your Medicaid coverage ends. You must notify the insurer of the loss of coverage.

  • Under a Medicare Supplement policy, a pre-existing condition is a medical condition for which medical advice was given or treatment was recommended by or received from a physician within six months prior to the effective date of coverage.

    A Medicare Supplement policy cannot use riders or endorsements to exclude, limit, or reduce coverage or benefits for specifically named or described pre-existing diseases or physical conditions.

    If a Medicare Supplement policy replaces another Medicare Supplement policy, the replacing insurer must waive any time periods applicable to pre-existing conditions including:

    • Waiting periods

    • Elimination periods

    • Probationary periods in the new Medicare Supplement policy for similar benefits to the extent such time was spent under the original policy

  • MMAP is a free health benefit counseling service for Medicare and Medicaid beneficiaries and their caregivers. MMAP works through the Area Agencies on Aging to provide high quality and accessible health benefit information and counseling, supported by a statewide network of unpaid and paid skilled professionals. MMAP counselors can help you:

    • Identify resources for prescription drug assistance.

    • Understand doctor bills, hospital bills and Medicare Summary Notices.

    • Understand Medicare/Medicaid eligibility, enrollment, coverage, claims and appeals.

    • Enroll in Medicare Savings Programs.

    • Review individual Medicare Supplemental insurance needs, compare policies and pursue claims and refunds.

    • Explore long-term care financing options, including long-term care insurance.

    • Identify and report Medicare/Medicaid fraud and abuse.

    You can contact MMAP at https://mmapinc.org/ or 800-803-7174.