Medigap Insurance Plans
The best time to buy a Medigap Insurance Plan is during your six-month open enrollment period, which begins on the first day of the month in which you are both 65 years old AND enrolled in Medicare Plan B. This means that if you were already enrolled in Medicare Plan B at age 64, and your birthday is on June 22, then your open enrollment period would be from June 1 – November 30. However, if you do not enroll in Medicare Plan B until you are, say, 67 years old, then your open enrollment period starts once your Plan B coverage begins.
The reason that your open enrollment period is the ideal time to purchase Medigap insurance is because insurance companies are legally required, during those six months, to sell you Medigap policies without charging you more for any existing health problems. However, if you have a preexisting condition, you should be aware that even if you do buy a Medigap Insurance Plan during your open enrollment period, the insurance company may refuse to cover any out-of-pocket expenses incurred by this preexisting condition for up to six months after you are enrolled in Medigap. There is one exception to this rule: if you had what is called “creditable coverage,” which includes most kinds of health coverage that you may have had before Medigap (not including Medicare), for at least sixty-three continuous days before your Medigap enrollment, the insurance company must begin coverage immediately.
If you decide to wait to purchase a Medigap Insurance Plan after your open enrollment period has ended, you may face difficulties due to the insurance company’s policy of medical underwriting. Medical underwriting is the name for the formula the insurance company uses to decide whether or not to sell you Medigap coverage, and at what price. This means that if you have health problems, you are likely to be charged significantly more than a healthy person would be.
Even if you miss your open enrollment period, there are certain cases in which you have what are called “guaranteed issue rights,” which give you the same benefits as applying during open enrollment. You have a guaranteed issue right if, for example, you are enrolled in a Medicare Advantage Plan, but your plan leaves Medicare or ends care in your area, or you move outside of the plan’s service area. There are several other cases in which you have a guaranteed issue right, so you should check with your insurance company to get further details.
