Why You Can Be Denied a Medigap Plan

by David Bynon, last updated

In all but four states, Medicare Supplements can deny coverage unless you have a guaranteed issue right. This is because Medicare Supplements, Medigap, are not health insurance. Different rules apply.

Can Medicare Supplement Plans Deny Coverage?

This article will examine the rules a private insurance company must follow if they sell Medicare Supplement Insurance (Medigap). This includes the most important rule for new Medicare beneficiaries, which guarantees the right to buy coverage.

Key Takeaways

  • Medigap, the federal government’s terminology for Medicare Supplement Insurance, was conceived at the time as Medicare.
  • To make it possible for everyone to get Medigap coverage, the federal government established a set of guidelines.
  • Any private insurance company that offers Medigap insurance must follow federal guidelines and state laws that govern insurance.
  • Every Medicare beneficiary is guaranteed the right to purchase Medigap coverage.
  • Some states have enhanced rules and protections governing a Medicare beneficiary’s rights.

What are the Rules to Get Into a Medicare Supplement Plan?

The federal government guarantees every Medicare beneficiary the right to buy a Medicare Supplement plan. The government’s protections prohibit an insurance company from denying coverage for any reason.

A Medicare beneficiary with guaranteed issue rights cannot be turned down due to pre-existing conditions, gender, race, religion, age, income, use of tobacco, or where they live. They cannot be turned down for any reason.

RELATED: How Much Does it Cost for Medicare Supplemental Insurance?

Can I Buy Any Medigap Plan I Choose?

Beneficiaries also have the right to buy the policy of their choosing, so long as they qualify. Over the years, the federal government has phased out some plans. Discontinued plans can’t be issued to new beneficiaries. Plan F and Plan C are the two most recent examples.

However, a beneficiary’s protections do not last forever. In general, your right to buy a policy only lasts for six months. This is your Medigap Open Enrollment Period.

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Can I be Denied Medicare Plan G?

Medicare Supplement Plan G is the most popular Medigap plan sold. Its popularity is based on the amount of coverage it offers.

The following chart compares the coverage of all Medicare Supplement plans. As you can see, Plan G covers everything except the Part B deductible.

Medicare Supplement Plans Comparison Chart for 2024

If you are still in your guaranteed issue period, your Plan G application cannot be turned down. Not for any reason. So, if you are contemplating, is Medicare Supplemental insurance worth it at age 65 while I’m still healthy, that’s the reason.

Can You Change Medicare Supplement Plans with Pre-existing Conditions?

If your Medigap protections have expired, Medigap insurers can turn you down. It all depends on your health history and the insurance company. Every insurance carrier has different medical underwriting standards.

Instead of denying your application altogether, some insurance companies may offer you a policy with less coverage on Medicare-covered services (like a Plan K policy), or they may require you to accept a six-month waiting period.

For instance, let’s say you recently had surgery for a fall accident. An insurance company may not want to cover anything related to the surgery until they know you are fully recovered. In this case, they might offer a policy with a six-month waiting period on coverage related to the surgery.

When is the Medigap Open Enrollment Period?

Unlike the Medicare Open Enrollment Period (formerly called the Annual Enrollment Period) each fall, Medicare Supplements do not have a set time each year for enrollment. Your Medigap Open Enrollment Period is unique to you.

When you first enroll in Medicare Part B your Medigap protections begin. Medigap protections last for six calendar months beginning the month your Part B coverage starts.

During this six-month period, you cannot be denied coverage. You can apply for the plan you want from the company you want to use. And, they cannot ask you questions about your health history or your health status.

However, a Medicare Supplement insurance company can ask for your name, age, gender, address, phone number, Medicare number, Social Security number, and banking information. They need this information to write your policy.

Can You Get Supplemental Insurance With a Pre-existing Condition?

Once your guaranteed issue rights expire, it is very difficult to qualify for Medicare Supplement Insurance. The medical underwriting standards most insurance companies use are simply too strict.

This is why planning ahead and buying a Medigap plan when you first qualify for Medicare is so important. None of us know what lies ahead in our future.

Can I Be Turned Down If I Have End-Stage Renal Disease?

If you have end-stage renal disease (ESRD), you may not be able to buy the Medigap policy you want, or any Medigap policy, until you turn age 65.

At age 65, you cannot be turned down. Prior to age 65 you can. Some states allow it and some don’t.

Can I Get Supplemental Insurance If I Am Disabled?

Can you be denied a Medicare Supplement plan if you are disabled? Yes. Here’s why.

Federal law does not guarantee the issuance of Medigap coverage for individuals under the age of 65. If you qualify for Medicare due to your Social Security Disability status, your ability to buy a Medicare Supplement plan will depend on where you live.

Which States Do Not Guarantee Medicare Supplement Coverage?

There are 29 states that do require insurers to sell Medicare Supplements to people who are eligible for Medicare, regardless of their age:

  • California **
  • Colorado
  • Connecticut
  • Delaware *
  • Florida
  • Georgia
  • Hawaii
  • Illinois
  • Kansas
  • Louisiana
  • Maine
  • Maryland
  • Massachusetts **
  • Michigan
  • Minnesota
  • Mississippi
  • Missouri
  • New Hampshire
  • New Jersey
  • New York
  • North Carolina
  • Oklahoma
  • Oregon
  • Pennsylvania
  • South Dakota
  • Tennessee
  • Texas
  • Vermont **
  • Wisconsin

*Only available to people with ESRD.
**Not available to people with ESRD.

Although your state may not require insurance companies to sell Medicare Supplements to people under age 65, some insurance companies do. In most cases, the cost will be higher and you can be denied coverage for preexisting conditions.

Can You Be Turned Down for Medicare Advantage?

Unlike Medicare Supplement Insurance, Medicare Advantage plans cannot deny coverage. These plans are protected by the Affordable Care Act, which does not allow health insurance companies to deny coverage due to a pre-existing condition.

To qualify for a Medicare Advantage plan, you must be enrolled in both Part A and Part B benefits. Plus, you must live in the plan’s service area.

Medicare Supplement plan denial is based on different laws under the federal Medicare program. That’s why private insurance companies can deny coverage.

Generally speaking, Medigap isn’t health insurance. It is a type of indemnity insurance. As a result, health insurance regulations do not apply and you can be denied a Medicare Supplement.

Can I Get a Medicare Supplement If I Have a Medicare Advantage Plan?

A Medigap policy is not compatible with Medicare Advantage plan coverage. In fact, it’s illegal for a Medigap insurance company to sell Medigap policies to people who are not enrolled in Medicare Part A and Part B.

You can’t use Medigap with any other health insurance plan or health coverage. This includes other federal coverage, like Medicaid or VA healthcare.

If you have a Medicare Advantage plan now, you might qualify to go back to Original Medicare, get a guaranteed issue Medigap policy, or get your former Medigap policy back.

Medicare created a new Medigap protection specifically for Medicare Advantage. It’s a trial right to try a Medicare Advantage plan without losing access to Medigap coverage.

It applies to both new Medicare beneficiaries, as well as people currently enrolled in Medicare and a Medicare Supplement plan. Your trial right last for 12 months.

Medicare Advantage Trial Right Benefits

If you are a first-time Medicare Advantage plan member, and you aren’t happy with the plan, federal law gives you a “trial right” to buy a Medigap policy and a separate Medicare drug plan if you return to Original Medicare.

Here’s the caveat. You must switch back within the first 12 months of joining the Medicare Advantage plan. Otherwise, you can be denied Medigap coverage based on your health issues.

Also, if you didn’t join the Medicare Advantage plan as soon as you qualified for Medicare, and you did not have a Medigap policy, you won’t get your guaranteed issue right back. Continuous coverage is required. This isn’t a loophole to get around being denied Medicare Supplement coverage.

Can I Lose Coverage If I Have Health Issues?

All standardized Medicare Supplement policies are guaranteed renewable, even if you have health problems. This means that your insurance company can’t cancel your due to your medical records, health condition, or the number of claims you make.

There are three different situations that can result in a canceled policy:

  1. You stop paying your premiums.
  2. You weren’t truthful on the application.
  3. The insurance company becomes bankrupt or insolvent.

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