Medicare Supplement Plans and Medical Underwriting
You may be concerned about medical underwriting when applying for a new Medicare Supplement insurance plan. Medical underwriting is a process in which insurance companies collect detailed information about your health and medical history. Based on this history, they will decide whether or not to accept your application for insurance and how much to charge you. People with a history of medical problems may pay more for insurance than people with no such history, or have their applications rejected entirely. Some plans may also issue a waiting period for coverage for a pre-existing condition* if state law allows it.
When medical underwriting can’t be used: Open Enrollment
Medicare Supplement insurance plans are offered by private insurance companies and can help you pay for out-of-pocket costs for services covered under Original Medicare. Generally these private insurance companies are allowed to use medical underwriting to decide whether or not to accept your application and how much to charge you. However, during your Medicare Supplement Open Enrollment Period, your health problems cannot be used to deny you a policy or charge you more for it.
Your Medicare Supplement Open Enrollment Period lasts for six months and begins on the first day of the month in which you’re both 65 or older and enrolled in Medicare Part B. So if you turn 65 in January and enroll in Medicare Part B in January, your Open Enrollment Period typically lasts from January to June. During this period you should be able to buy any policy the health insurance company offers at the price for someone with no health problems, regardless of your past or current health problems. The health insurance company also can’t make you wait for your coverage to start except sometimes in the case of a pre-existing condition*. In some cases, the insurance company may make you wait up to six months for the coverage of a health problem that pre-dated the policy in a period called the “pre-existing condition* waiting period.“ After the waiting period, the policy may cover the condition.
If you apply for a Medicare Supplement insurance plan after your Open Enrollment Period, you may have to meet medical underwriting requirements and your application may be rejected on the basis of a health condition. If you are under 65, some insurance companies may voluntarily sell you a Medicare Supplement insurance plan. However, the will probably cost you more than a plan sold to someone 65 or older and the insurance company will probably use medical underwriting when processing your application. However, in some states you can’t sign up for a Medicare Supplement insurance plan when you’re under age 65.
When medical underwriting can’t be used: guaranteed-issue rights
Certain situations may give you “guaranteed-issue rights,“ which allow you Medicare Supplement enrollment access similar to what you have during your Medicare Supplement Open Enrollment Period. A situation that might qualify you for guaranteed issue is if you have Original Medicare and a Medicare SELECT policy and you move out of the Medicare SELECT policy’s service area. A Medicare SELECT policy is a type of Medicare Supplement insurance plan that may require you to use hospitals and doctors within network in order to be eligible for full benefits.
You might also qualify for guaranteed-issue rights if your Medicare Supplement insurance company goes bankrupt and your coverage ends through no fault of your own. A third situation could be that you had a Medicare Advantage plan but the plan stops giving care in your area or you move out of the plan’s service area. In most cases you will have 63 days after your health care coverage ends to apply for a Medicare Supplement insurance plan.
Medical underwriting could make a big difference in the price you pay for a Medicare Supplement insurance plan and whether or not you get covered. Pay attention to your Open Enrollment Period and guaranteed-issue rights to avoid medical underwriting.
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*Pre-existing conditions are generally health conditions that existed before the start of a policy. They may limit coverage, be excluded from coverage, or even prevent you from being approved for a policy; however, the exact definition and relevant limitations or exclusions of coverage will vary with each plan, so check a specific plan’s official plan documents to understand how that plan handles pre-existing conditions.