How Do I Switch from Medicare Advantage to Medigap?

Many people get into a Medicare Advantage plan with the belief that it will cost less than Original Medicare. For some people, it works out that way. For others, it doesn’t.

When it doesn’t, Medigap may be a better solution.

If you have discovered the difference between Medicare Supplements and Medicare Advantage and you want to switch, you have two options.  You can switch from Medicare Advantage to Medigap if you are within your trial right period. You may also have the option to make the switch during two Medicare enrollment periodsEnrollment periods are designated time periods to enroll or disenroll from the various parts of Medicare. There are six Medicare enrollment periods..

In this article, we will walk through your trial right, other Medigap protections, and exactly when you can make the switch from Medicare Advantage to Original Medicare.

Can I Switch from a Medicare Advantage Plan Back to Original Medicare?

Yes. However, there are certain enrollment periods and restrictions.

In most cases, you can only make plan changes during certain times. Medicare has an Open Enrollment PeriodDuring the Medicare Open Enrollment Period, Medicare Advantage and Part D plan members can change, switch, or drop a plan they chose during the Annual Election Period. OEP starts on January 1 and ends on March 31. every fall. During this annual enrollment periodThe Annual Enrollment Period is when Medicare beneficiaries can join, drop or change Medicare Advantage and Medicare Part D prescription drug plans. AEP begins on 15 October and ends on 7 December., Medicare beneficiaries can join, change, or drop a Medicare Advantage plan. This enrollment period begins October 15 and ends December 7.

There is a second Medicare Advantage Open EnrollmentIn health insurance, open enrollment is a period during which a person may enroll in or change their selection of health plan benefits. Health plan enrollment is ordinarily subject to restrictions. Period from January 1 through March 31. During this period, beneficiaries enrolled in a Medicare Advantage plan can change plans or go back to Original Medicare.

Can I Switch from a Medicare Advantage Plan to a Medigap Plan?

Maybe.

A Medigap policy is not health insurance. It is a form of indemnity insurance that helps pay some of the costs of Original Medicare.

To buy a Medigap policy, you must be enrolled in both Medicare Part A (hospital insurance) and Medicare Part BMedicare Part B is medical coverage for people with Original Medicare benefits. It covers doctor visits, preventative care, tests, durable medical equipment, and supplies. Medicare Part B pays 80 percent of most medically necessary healthcare services. (medical coverage). Then you can apply for Medigap coverage.

However, private insurance companies may not approve your application. It all depends on three things:

1. Your guaranteed issue rightsGuaranteed-issue is a right granted to Medicare beneficiaries and applies to Medicare Supplement insurance (aka, Medigap plans). All states and the federal government enforce this essential right, which protects Medicare beneficiaries from medical underwriting.;
2. Your Medicare Advantage trial right; and
3. Your health history.

What is the Medicare Advantage Trial Right?

The first time you join a Medicare Advantage plan, Medicare gives you a special privilege. It is your “trial right”.

If you join a Medicare Advantage plan and you aren’t happy with the plan, federal law gives you the right to switch plans back to Original Medicare. When you do, you can buy a Medigap policy. However, you must make the switch within the first 12 months of joining the Medicare Advantage plan.

You can do this if you got a Medicare Advantage plan at age 65. You can also do it if you had a Medicare Supplement and then decided to try Medicare Advantage.

If you had a Medicare Supplement plan before your trial right began, you have the right to ask your insurance company to reissue the policy. If not, you can apply for a new policy.

When Do I Have Guaranteed Issue Rights?

When you first sign up for Medicare at age 65, you have certain Medigap protections. The most important protection is your guaranteed right to purchase Medicare Supplement Insurance.

Your guaranteed issue rights start the month you enroll in Medicare Part B and end 6 calendar months later. This is your Medigap Open Enrollment PeriodUpon initial enrollment in Medicare Part A and Part B, beneficiaries have a one-time, six-month period to buy a  Medicare supplement policy with guaranteed issue rights. This is the Medigap Open Enrollment Period.. When this open enrollment period is over, so is your right to buy a Medigap policy without medical underwriting.

Can I Be Denied Medigap Coverage?

Yes. When your guaranteed issue rights expire, after your initial enrollment periodThe Initial Enrollment Period is a seven-month period when new beneficiaries can enroll in Medicare without a penalty. Most people enroll in Medicare at age 65., you can be turned down for coverage.

A Medigap policy isn’t health insurance, so insurance carriers are not required to follow the same rules. Specifically, you can be denied coverage due to a pre-existing conditionA pre-existing condition is any health problem that occurred before enrolling in a health plan. The Affordable Care Act law made it illegal for health plans to or charge more due to a pre-existing condition.....

Unlike Medicare Advantage plans, which cannot deny coverage based on your health conditions, insurance companies that sell Medigap policies can.

Is a Medigap Plan Better Than an Advantage Plan?

Maybe.

Most insurance experts agree that Original Medicare, combined with a Medigap policy and a Medicare prescription drug plan (Part DMedicare Part D plans are an option Medicare beneficiaries can use to get prescription drug coverage. Part D plans provide cost-sharing on covered medications in four different phases: deductible, initial coverage, coverage gap, and catastrophic. Each...), is the best coverage you can get. That said, many Medicare Advantage plans offer additional benefits, such as routine dental or vision care, transportation, and other healthcare services.

When “Better” Means More Coverage

Medicare covers about 80% of all major healthcare costs. The remaining costs are paid by the Medicare beneficiaryA person who has health care insurance through the Medicare or Medicaid programs. through various deductiblesA deductible is an amount a beneficiary must pay for their health care expenses before the health insurance policy begins to pay its share., copaysA copayment, also known as a copay, is a set dollar amount you are required to pay for a medical service., and coinsuranceCoinsurance is a percentage of the total you are required to pay for a medical service.  costs when they use approved healthcare services.

Medicare Advantage plans work the same way. Only, each plan sets its own rules, restrictions, and costs. And, you can’t buy more coverage for Medicare Advantage. A Medigap policy only works with Original Medicare.

If you want more coverage on Medicare’s out-of-pocket costs, you buy a Medigap plan. There are 10 standardized plans (A through N). Each plan covers different costs. The best way to compare what each Medigap plan covers is to look at a chart:

All Medigap plans cover the Part A coinsurance and most plans cover some or all of the $1,600 Part A deductible. This is a benefit periodA benefit period is a method used in Original Medicare to measure a beneficiaries use of hospital and skilled nursing facility (SNF) services. With each new benefit period, the beneficiary is charged a new benefit... deductible that you pay everytime you have a hospital stay (unless you are readmitted withing 60 days for a related issue).

All Medicare Supplement plans cover some or all of the 20% Medicare Part B coinsurance. And a couple of plans cover Part B excess chargesA Medicare Part B excess charge is the difference between a health care provider’s actual charge and Medicare’s approved amount for payment. and the Part B deductible.

Medicare’s out-of-pocket costs can easily bankrupt you. Medicare does not have a maximum out-of-pocket limit. That’s why a Medigap policy is so important.

Medicare Advantage plans do have a maximum out-of-pocket limit. The limit applies to Part A and Part B services. This year the out-of-pocket limit on Medicare Advantage plans can be as high as $7,550. That’s unaffordable for most people.

When “Best” Means More Benefits

The advantage most people see in a private Medicare plan is the extra benefits. Most Medicare Advantage plans include prescription drug coverage. And many plans also include routine dental, vision, and hearing care.

To get additional benefits with a Medigap plan you must buy them. For instance, you can get Medicare prescription drug coverage by joining a Part D plan, but you’ll pay an additional monthly premium. You can add a separate dental and vision plan for those benefits, too.

For healthy people, who rarely use their primary healthcare benefits, Medicare Advantage plans are a good value. The monthly premiumsA premium is an amount that an insurance policyholder must pay for coverage. Premiums are typically paid on a monthly basis. In the federal Medicare program, there are four different types of premiums.  are low, and some plans have no additional premium at all.

And, if you rarely see a doctor, outside of your annual wellness visits, you don’t incur big out-of-pocket costs. That’s why these plans are so beneficial to healthy people.

More Medicare Advantage vs. Medigap Issues

If you join a Medicare Advantage plan, it’s important to remember that you must use healthcare providers in the plan’s service area and in the plan’s provider network. Many services may also require prior authorizationPrior authorization is a process used by health plans to control healthcare costs. Most HMO plans and some PPO plans require authorization before receiving certain treatments, medical services, or prescription drugs. and/or a referral from your primary care physician.

With Original Medicare and Medigap, you can see any provider that accepts Medicare. And, you never need pre-authorization to receive a Medicare-approved service. In general, there are fewer provider limitations. And, some plans offer coverage in foreign countries.