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Medicare Advantage Agents Should Tell Consumers About Medigap: CMS

News November 26, 2024 at 05:44 PM
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What You Need To Know

  • Both Medicare Advantage plans and Medigap policies fill in original Medicare coverage gaps.
  • Medigap policies are typically more flexible.
  • Medicare enrollees can sign up for Medicare Advantage plan during an open enrollment period every year.
  • Consumers get easy, underwriting-free access to Medigap policies only when they turn 65.
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Medicare program managers want the agents and brokers who help sell Medicare Advantage plans to make sure consumers know how limited their ability to sign up for Medicare supplement insurance policies might be.

Officials at the Centers for Medicare and Medicaid Services have included a Medicare supplement insurance awareness section in a proposed list of matters CMS wants producers to discuss with consumers during enrollment sessions.

CMS officials put the consumer enrollment conversation guide in a new set of proposed requirements for the plans and marketing strategies that health insurers will be using to participate in the Medicare Advantage plan program and Medicare Part D prescription drug plan program in 2026.

Sellers of Medicare Advantage plans and sellers of Medicare supplement insurance policies, which are also called Medigap policies, have traditionally competed like cats and dogs.

CMS is requiring Medicare Advantage plan agents to tell consumers about the competition because the counselors at state Medicare helplines are seeing consumer confusion about how the Medigap enrollment process works, CMS officials say in the introduction to the new proposed regulations.

The proposal also includes a list of questions that CMS wants agents and brokers to address during Medicare Advantage plan enrollment sessions.

Agents should talk about whether the Medicare Advantage plans will cover consumers' current health care providers and the drugs they are taking, and about special programs that could cut the consumers' costs, according to the proposed regulations.

"Conclude by pausing to ask if the beneficiary has any questions about the topics discussed," officials say.

Medigap basics: The original Medicare program makes the insureds responsible for paying many deductibles, copayments and coinsurance amounts. Consumers who have no supplemental coverage or access to special government support programs for low-income people could end up facing tens of thousands of dollars in medical bills that are not covered by Medicare.

Medicare Advantage plans fill in the original Medicare gaps by providing what looks to the enrollees like a soup-to-nuts replacement for original Medicare. The enrollees get low monthly premiums and extra benefits, such as some dental care benefits, in exchange for agreeing to see in-network providers and accept the plan's care utilization management programs.

Medigap policies, which were created by a different federal law, simply fill in original Medicare gaps without requiring the insureds to see in-network providers or verifying whether the insurers think the care their providers have recommended should be covered.

Any Medicare enrollee can sign for a Medicare Advantage plan, without going through medical underwriting or paying extra due to health problems, during an annual enrollment period that runs from Oct. 15 through Dec. 7 every year.

For Medigap coverage, a consumer with health problems can automatically get coverage on a guaranteed-issue basis, for the same price that healthy people pay, only if the consumer applies during a six-month period around the time the consumer turns 65 and signs up for original Medicare Part B outpatient hospital care and physician services coverage.

In most states, consumers who want to sign up for Medigap outside of the initial open enrollment window must either go through a medical underwriting process or find a way to qualify for a special enrollment period. A consumer can qualify for a special enrollment period by, for example, moving to a new location.

The Biden-to-Trump shift: The officials who developed the proposal are part of the administration of President Joe Biden. The administration is leaving office and it's now implementing the rules for the rocky annual enrollment period for 2025 Medicare plan coverage, which started Oct. 15 and is set to end Dec. 7.

CMS recently backed away from implementing major changes in Medicare plan distributor support services payments for 2025. The agency went ahead with implementing Medicare Part D drug plan benefits design changes and Medicare Advantage plan program insurer reimbursement changes that led to major changes in Medicare Advantage plan menus and even more changes in Medicare Part D prescription drug plan menus.

The administration of President-elect Donald Trump could withdraw the proposed regulations, change them or replace them.

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