Switching Medicare Supplement Insurance Plans: What to Know

Summary: Switching Medicare supplement insurance plans after you’ve already enrolled will require fulfilling specific conditions. If you’ve decided a switch is right for you, this guide will help you understand how to change your Medicare supplement plan.

During your Medicare supplement Open Enrollment Period, you have the freedom to select any Medicare supplement plan (also known as Medigap) without regard to your pre-existing conditions or health status.

Starting when you are 65 and enrolled in Original Medicare Part B, the Medicare supplement insurance Open Enrollment Period is the ideal time to select the plan that’s right for you. Insurance companies cannot deny you coverage or charge you higher premiums based on your health care needs during this period.

What happens next?  What if you decide you want a different Medicare supplement insurance plan at a later date? Can you change Medicare supplement insurance plans after Open Enrollment?

Can you change Medicare supplement plans anytime?

You can apply to change Medicare supplement plans at any time after your Open Enrollment Period, but approval is not guaranteed and you may be denied coverage due to health conditions.

Certain unique events, such as moving to a new location or losing existing health coverage, may nevertheless offer assured issue privileges, potentially making you eligible to switch your Medicare plan without underwriting.

How to change Medicare supplement plans

You might decide you want to switch your Medicare supplement plan if:

• You are looking for a lower price
• You are looking for more or fewer benefits, depending on your needs
• You want a different insurance carrier

The process for changing Medicare supplement plans depends on different  enrollment periods. These periods determine when you can switch plans without facing penalties or medical underwriting.

Switching plans after the Medicare Supplement Open Enrollment Period

After your Initial Enrollment Period (when you are first eligible to enroll in Original Medicare Parts A and B) and the Medicare supplement Open Enrollment Period (when you are 65 or older and have Part B), you can apply to change Medicare supplement plans at any time, but approval is not guaranteed (unlike during the Medicare supplement Open Enrollment Period). When you apply for a new Medicare supplement plan, insurers can use medical underwriting to decide whether to accept your application and at what price. This means they can deny coverage or charge higher premiums based on your health condition.

Special enrollment periods and guaranteed issue rights

Certain circumstances, sometimes referred to as guaranteed issue rights, allow you to switch Medicare supplement plans without medical underwriting concern. These rights are generally available when:

• Losing other health coverage: If your current health coverage is lost—perhaps from an employer or union plan—you could be eligible for a special enrollment period.
• Moving to a new location: When you move to a new location, there is a provision to select Medicare change of address plan if your present plan is not available in your new location.
• Health insurance company concerns: Guaranteed issue rights let you transfer plans if your Medicare supplement insurance company fails or deceives you.
• Trial rights: If you first join a Medicare Advantage plan (Part C) and choose to switch to Medicare supplement insurance within the first year, you can do so without underwriting.
• State specials: Depending on your state of residence, there could be different rules that apply to enrollment and underwriting. Rules vary by state, so you must check with your Local State Insurance Department for clarity.

Considerations for changing Medicare supplement plans

When contemplating a switch in your Medicare supplement plans, there are several important factors to consider. Here’s what you need to keep in mind when considering a change in your Medicare supplement coverage.

Your healthcare needs

Before switching Medicare supplement plans, assess your current and future healthcare needs. The following are questions you should ask yourself:

• Review your existing coverage to ensure it meets your healthcare requirements, including hospital stays, doctor visits, and prescription medications.

• Consider any recent changes in your health status, such as new diagnoses or treatments, that may necessitate different coverage.

• Anticipate any future healthcare needs, such as planned surgeries or ongoing treatment for chronic conditions.

Comparison of Medicare supplement plans

When looking to switch plans, you should compare the different Medicare supplement plans available. Ensure the new plan covers the services and treatments you need. Different plans offer varying levels of coverage for expenses, such as hospital stays, skilled nursing facility care, and foreign travel emergencies.

Although Medicare supplement insurance plans generally don’t have network restrictions, confirm that your preferred doctors and hospitals accept the new plan.  And if you’re looking to switch insurance carriers, be sure to thoroughly research and evaluate the carriers. For instance, you can research their longevity and the brand’s reputation or read customer reviews.

Financial considerations

Switching Medicare supplement plans involves various financial considerations, such as

• Premium changes: The cost or premium of the new Medicare supplement plans might be different from your current plan. Consider how these changes fit into your budget.
• Out-of-pocket costs: Evaluate the out-of-pocket costs associated with the new plan, including co-pays, deductibles, and co-insurance.
• Waiting periods for pre-existing conditions: Some plans may impose waiting periods for coverage of pre-existing conditions if you switch outside of your open enrollment period.

What if you are enrolling for a Medicare plan for the first time?

You can enroll in Original Medicare for the first time during your Initial Enrollment Period. The initial enrollment period is 7 months long, starting 3 months before the month you turn 65, including your birth month and the 3 months after your 65th birthday.

As far as Medicare supplement plans are concerned, you can sign up for a plan for the first time during your Medicare supplement Open Enrollment Period: This 6-month period automatically starts the first day of the month you are 65 or older and are enrolled in Medicare Part B.

During this period, you can apply for any Medicare supplement plan sold in your state. Medicare supplement companies cannot deny you coverage, place conditions on a policy, or charge you more due to a pre-existing health condition during this period.

Penalties for late enrollment

If you decide a Medicare supplement insurance plan is right for you, the easiest approach to avoiding penalties and ensuring you get the coverage you need is to apply during your Medicare supplement Open Enrollment Period. However, applicants should note that there are some exceptions.

Some of the issues you will have to negotiate include:

1. Medical underwriting: Following your Initial Enrollment Period, insurers may require medical underwriting, which can lead to rejection of coverage depending on your health status or increased premiums.
2. Waiting periods for pre-existing conditions: If you enroll in a Medicare supplement plan following your Open Enrollment Period, the insurer may impose a waiting period of up to six months before providing coverage for any pre-existing health conditions. In other words, you would have to pay out of pocket for any treatment linked to those illnesses during this period.
3. Higher premiums: Delaying enrollment could lead to increased monthly costs since insurance companies examine your age and medical condition during underwriting. As a result, your Medicare supplement coverage could cost significantly more than if you had enrolled during your first open enrollment period.

Conclusion

Understanding important factors, including enrollment periods, pre-existing conditions, and possible penalties for late enrollment, helps you navigate the complexity of switching Medicare supplement plans.

Your Medicare supplement Open Enrollment Period (which offers guaranteed coverage free from medical underwriting) is the ideal time to choose the plan that’s right for you. Outside of this time, guaranteed issue rights and special enrollment periods may apply, but they may also come with certain restrictions or penalties. If you decide you want to change your current Medicare supplement policy or carrier, you will need to contact your current insurance company to cancel it.*

We know Medicare can be confusing. If you’re looking for help, the Mutual of Omaha Medicare Advice Center can provide personalized guidance with a free tool that can help you determine which Medicare solution is best for you. You can also find answers to commonly asked questions and information on Medicare basics.

At  Mutual of Omaha, we’re here to empower you to understand your insurance options, so you can make choices that work for you.

*Note: If you choose to cancel your current Medicare supplement policy and are denied coverage from a new plan, you may not be able to get your old plan back.