Has Your Medicare Advantage Plan Been Discontinued by Your Carrier? You Have Unique Opportunities.

If your Medicare Advantage Prescription Drug (MAPD) plan is leaving your area, you’re not alone. Each year, some Medicare Advantage plans decide not to renew their contracts. The good news is that when this happens, you will have new options for your Medicare coverage.

One of the most important opportunities available to you when your plan exits the market, or when its contract with Medicare is not renewed, is enrolling in a Medigap (Medicare Supplement) policy with Guaranteed Issue. If you’ve only ever had a Medicare Advantage plan, this is a very different kind of coverage than you’re used to. Let’s break down what that means.

MAPD vs. Medigap: What’s the Difference?

Medicare Advantage (MAPD)

• Managed care approach: MAPD plans are run by private insurance companies. Medicare “hires” these companies to take over the administration and management of your care.

• One card, one premium simplicity: Whether you go to the doctor, hospital, eye doctor, dentist, or pharmacy, you use the single ID card issued by your MAPD carrier. And because medical, drug, and extra benefits are bundled together, you pay one monthly premium (sometimes even $0). This makes MAPD simple and often more affordable as compared to coordinating multiple separate coverages and premiums.

• Networks and oversight: MAPD plans often require preauthorizations for certain procedures or treatments. This, along with denied or delayed claims are among the most common concerns raised as related to MAPDs.

• Extra benefits: On the plus side, many MAPD plans historically have included vision, dental, fitness programs, and other perks that are not included as part of the Original Medicare program.

• Cost-sharing built in: While the premium is often lower (often considerably), MAPD plans use a “pay as you go” model. This means you’ll pay copayments, coinsurance, and deductibles as you use services, but only up to the plan’s annual out-of-pocket maximum.

• Changing structure: MAPD plans' contracts with Medicare are reviewed and renewed each year. Premiums, cost-sharing, networks, and benefits can (and often do) change annually.

  
  

Medigap (Medicare Supplement)

• Using Original Medicare: With Medigap policy coverage, you are covered directly by Original Medicare as your primary payor. In other words, Medicare itself pays your medical bills first.

• You purchase a Medigap policy from an insurance company, which comes with a monthly premium, one that is generally higher than an MAPD premium. This policy will cover the costs you would have incurred under original Medicare.

• How it works in real life:

  • When you visit a doctor or go to the ER, urgent care, or hospital, you’ll show your red, white, and blue Medicare ID card so Medicare can pay its share.

  • You’ll also show your Medigap policy card so the bills that would normally come to you (like Medicare Part A and Part B deductibles, coinsurance, or copays) are instead sent to your Medigap insurer. As a result, so long as your medical services are covered by Medicare, and depending on your Medigap policy, you will rarely get a bill for medically necessary services.

  • Since Medigap only covers services that Medicare itself covers, you’ll also need a separate prescription drug (Part D) plan, and other plans for dental, vision, or hearing coverage, if you want those. Each of these coverages comes with its own separate premium, which you’ll need to budget for.

• No preauthorizations or denials: If Medicare covers a service and pays its share, your Medigap plan will automatically cover its portion too. (Note: there are some special circumstances that require preauthorization by Medicare, but they are not the norm.)

• Stable benefits: Medigap benefits do not change year over year. Your policy is guaranteed renewable for life and cannot be canceled as long as premiums are paid.

• Premium changes: While the benefits remain stable, premiums can and often do increase over time. Most policies come with an annual premium rate increase.

  
  

Why Must You Take Action?

If your MAPD plan is exiting, you cannot simply do nothing. Without new coverage in place, you risk being left with only Original Medicare, which exposes you to significant out-of-pocket costs. Fortunately, your situation gives you options:

1. Enroll in a new MAPD plan if you like the managed care model, appreciate bundled prescription drug coverage, and value the extra perks these plans often include; or,

2. Purchase a Medigap policy (Basic, Extended Basic, or Plan N for example) and enroll in a standalone Part D (prescription drug) plan.

   
   

What is Medigap Guaranteed Issue, and Why Does It Matter?

Normally, when you apply to purchase a Medigap policy, the insurance company can ask you health questions and turn you down if you have pre-existing conditions. That’s called medical underwriting. But when your MAPD plan exits the market, you get a Guaranteed Issue right. That means you cannot be denied a Medigap policy based on your health.

This is a special opportunity that most people don’t have once they’ve been on Medicare for a while. It allows you to move into the stability of a Medigap policy at a time when many beneficiaries are most concerned about protecting access to care. However, you have a limited window to use this right and purchase your Medigap coverage.

Medigap in Minnesota

Unlike most states that use standardized lettered plans (Plan A, G, N, etc.), Minnesota has its own standardized Medigap system. The most common policy choices are:

• Basic Plan: Covers many of the Medicare cost-sharing gaps. You can add optional riders to increase coverage.

• Extended Basic Plan: Includes all the Basic benefits plus additional protections.

• Medigap Plan N: Offers lower premiums versus the Basic or Extended Basic plans, and similar coverage to a Basic Plan, but you will have small copays for office ($20) and ER ($50) visits.

  
  

The Pros and Cons of Medigap

Pros:

• Freedom to see any Medicare-accepting provider nationwide. (No networks.)

• No prior authorizations or claims denials if Medicare covers the service.

• Stable benefits that don’t change year to year.

• Lifetime renewability: Your carrier cannot cancel coverage unless premiums are not paid.

• Predictable costs with fewer surprise bills.

Cons:

• Higher monthly premiums compared to most MAPD plans.

• Requires separate plans and premiums for prescription drug coverage and any extras like dental or vision.

• If it's not covered by Original Medicare, it won't be covered by Medigap (with some exceptions for international travel on some policies).

  
  
  
  

What Coverage is Most Appropriate for You if You Lose Your Medicare Advantage Coverage Due to Plan Exit?

A good candidate for moving to Medigap coverage might be someone who:

• Has a chronic illness or uses healthcare frequently, has high out of pocket costs, and is consistently hitting their MAPD out-of-pocket maximum.

• Travels often or splits time between states, and values nationwide provider access without network restrictions.

• Wants fewer hassles, avoiding prior authorizations and claims denials.

• Prefers paying a higher, predictable premium to reduce surprise bills, and accepts that they will have to purchase extra benefits separately, and can afford to do so.

• Wants benefits that stay the same year after year.

  
  

A good candidate for continuing with MAPD coverage might be someone who:

• Is generally healthy and doesn’t need much medical care.

• Wants a lower monthly premium, even if it means paying more out of pocket when services are used.

• Appreciates one premium that bundles medical, drug, and extra benefits together.

• Values perks like vision, dental, fitness, or over-the-counter allowances.

• Is comfortable with prior authorizations or network rules if it helps keep costs down.

The Bottom Line

Losing your MAPD plan is disruptive, but it also opens a door to new choices. There are many other Medicare Advantage plans available in most Minnesota counties that provide broad care, including extra benefits, at a range of premiums to meet every budget. And Minnesota’s Medigap system gives you flexible, guaranteed coverage options as well. (One important consideration: While switching from MAPD to Medigap can be difficult due to underwriting, there’s no underwriting required when enrolling in MAPD later. That means you can use your Guaranteed Issue privilege now with Medigap, and still have the flexibility to return to managed care in the future if your needs or preferences change.)

There is a lot to consider in a short window of time. Your budget, your health, and where you get care, along with your prescription drug coverage needs, all play an important role, and you have a limited window to make decisions that will impact your health and your finances in the future. This is where working with an independent, licensed agency like Milestone Medicare makes a difference. We can:

• Help you compare MAPD plans available to you, as well as Minnesota's Medigap plans (Basic, Extended Basic, and Plan N), to help you determine and secure the most appropriate coverage for your unique needs.

• Match you with the right prescription drug coverage, as a consideration related to your MAPD plan choice or as a standalone plan to pair with Medigap.

• Manage the moving parts to ensure you have no coverage gaps or lapses.

  
  

Reach out to us today: Our services are available at no cost to you! We look forward to working with you to help you turn your MAPD plan exit into a new opportunity.

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