Displaced Medicare Advantage Enrollees Need Help, Officials Say

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State insurance regulators are looking for ways to help people affected by Medicare Advantage plan upheaval buy Medicare supplement insurance policies without facing medical underwriting.

The topic has come up this week during sessions organized by at least two National Association of Insurance Commissioners teams at an in-person NAIC meeting in Denver.

Members of the NAIC's Senior Issues Task Force talked about the Medicare supplement insurance access problem Sunday with representatives from the Centers for Medicare and Medicaid Services, the arm of the U.S. Department of Health and Human Services that oversees Medicare.

Members of the NAIC/Consumer Liaison Committee heard a presentation on the issue during a session Tuesday.

Bonnie Burns and Ammy Killelea said during the NAIC/Consumer Liaison Committee presentation that states can help displaced Medicare Advantage plan enrollees by creating their own special enrollment periods, or extra opportunities for people to sign up for Medicare supplement insurance.

States can also ask Xavier Becerra, the Health and Human Services secretary, to exercise his broad authority to create a special enrollment period, Burns and Killelea said.

Such a period should be available when a Medicare Advantage plan faces a significant loss of health care providers as well as when a plan leaves a market, Burns and Killelea said.

The backdrop: The "original Medicare" program exposes enrollees to many coverage gaps.

A large majority of the 64 million enrollees use Medicare Advantage plans, Medicare supplement insurance or other arrangements, such as government programs aimed at low-income people, to cope with the deductibles, coinsurance bills and co-payment requirements.

Original Medicare and Medicare Advantage plans operate under laws that provide opportunities for Medicare enrollees to get coverage on a guaranteed-issue basis, without facing medical underwriting, every year.

Medicare supplement insurance policies, also known as Medigap policies, operate under a federal law that provides guaranteed-issue access to coverage for all Medicare enrollees only during a limited period around the time when people turn 65. After the first enrollment window closes, federal law gives Medicare enrollees the right to buy Medigap policies on a guaranteed-issue basis only if they qualify for special enrollment periods.

Some states have laws requiring Medigap issuers to provide special enrollment periods in some situations.

Medigap issuers use the enrollment period restrictions to reduce the odds that they will end up facing a rush of new enrollees with high claim costs.

This year, the lack of a broad Medigap enrollment opportunity has received more attention than usual, because some insurers have narrowed their Medicare Advantage plan menus and plan provider networks due to concerns about federal funding rules. Plan menu changes appear to have increased the number of Medicare Advantage plan enrollees who want to shift to Original Medicare with Medigap coverage.

For clients with a moderately high income and health problems who are using Medicare to pay for care, moving to Original Medicare may be very difficult.

Using regular Medicare without supplemental coverage could expose them to tens of thousands of dollars or more in costs related to deductibles and coinsurance bills.

They may not be able to qualify for programs that help low-income people limit Medicare out-of-pocket costs.

But, because Medigap issuers can usually put applicants who are outside their original enrollment window through medical underwriting, older clients with health problems who have no access to a special enrollment period may not be able to buy Medigap insurance at any price and may have no practical way to return to Original Medicare.

Some states, like Nebraska, have been arranging for special enrollment periods for unhappy Medicare Advantage plan enrollees.

Elsewhere, some Medicare Advantage plan enrollees with health problems who want to shift to Original Medicare with Medigap may be thinking of moving out of their current locations, to qualify for special enrollment periods based on moves to new locations.

Credit: CMS