medigap underwriting Archives

Should I Change My Medigap Plan If the Rate Goes Up?

April 24, 2023 By Garrett Ball Leave a Comment

Should you change your Medigap plan if your rate increases? This is a great question and one that many Medicare beneficiaries ask as they get older and experience changes to their Medigap premiums. The short answer is “Yes!”; however, the answer is a little more complex than that.

First, let’s start with a basic fact – just like most other things in our lives and other types of insurance, your Medigap rate is going to go up over time! No matter what your insurance agent told you when you signed up, it is going to go up over time. Now, different companies may go up different amounts and future increases are very difficult to predict because they are based on claims ratios, changes to Medicare, and inflation – three variables that are uncertain. One thing that is not uncertain, though, is that the rate is going to go up. (Related: How Much Do Medigap Premiums Go Up Each Year?)

With that basic fact out of the way, WHEN it does go up, you should receive a notification by mail from your insurance company about 30-60 days in advance of when the rate is going to change. For most companies, rate changes occur in your policy anniversary month. This is usually your birthday month, assuming that you signed up for a Medigap plan the month you turned 65. The letter you receive will contain your new rate and should act as a prompt for investigating whether it makes sense to stay with the same plan or explore other options.

In most cases, especially if you have had the same Medigap plan for more than a year or two, there will be other options available for equivalent coverage (all plans are standardized – Medigap coverage chart) at a lower premium. If you have a broker, the broker should be able to easily provide you with a full list of plans so you can see how your rate compares to what else is available for your zip code and age. If you can save money for the same plan, it may make sense to change to a different company.

When Can You Change Your Medigap Plan?

Contrary to common misconception, you can change your Medigap plan at any time of the year. You don’t have to, and really shouldn’t, wait until the end of the year to change plans. The end of the year annual election period (what people call “open enrollment”) is all about Part D and Advantage plans and does not have anything to do with Medigap. Moreover, there are more people changing plans at that time of year and underwriting is different and slower.

The best time to change your Medigap plan is one month before your rate increase is going to take effect, making the new plan effective on the date that your current plan is changing its rate. In other words, in a hypothetical situation, you get a notice that your plan is going up in late April and the change is going to take effect on your policy anniversary date of 6/1 because that is your birthday month and you signed up when you turned 65. Once you get that notice, you review other plan premiums and see that you can save $40/month by switching from your current Medigap company to a different Medigap company for the same Plan G coverage. You can do an application in April or early May for a 6/1 effective date (usually takes 7-10 business days to be approved) and avoid the increase and save some money while keeping the same coverage.

How Do You Change Your Medigap Plan?

Changing Medigap plans is relatively easy to do, particularly if you are in pretty good health. When you first turn 65 or start on Medicare, you have an open enrollment during which you do not have to answer medical questions or be approved into a Medigap plan. However, after that initial 6 month open enrollment period, you do have to “qualify medically” in most instances (exceptions: states that have a birthday rule).

So, part of the changing process will be completing an application, providing health/medication information and going through review by an underwriter.

But the first step to changing your Medigap plan is reviewing Medigap quotes. This can be done by contacting your Medigap broker if you have one. He or she can provide you with a list of available Medigap plans and their premiums and even make recommendations based on their previous experiences with the different companies.

Once you have selected a new plan to apply for, you would complete an application for the new company. This can typically be done online or by phone in a matter of minutes. It usually takes about 7-10 days for the new company to review your application and approve it.

Medigap Underwriting Process

As mentioned above, a new Medigap policy will need to go through underwriting unless you fall into a unique situation or live in one of the states that has a “birthday rule”.

This underwriting process varies from company to company, as all companies ask different health questions and have different requirements. Aside from filling in health and medications information on the application itself, you also may need to have a telephone interview with a Medigap underwriter as part of the approval process.

Reviewing each company’s underwriting guidelines and processes is something your Medigap broker should be able to assist with as part of the company selection process.

If you have any questions about this process or would like a list of the plan options available to you, please contact us here or call us at 877.506.3378.

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65Medicare.org is a leading, independent Medicare insurance agency for people turning 65 and going on Medicare. If you have any questions about this information or would like to see if there is a mutual fit to work together, you can contact us online or call us at 877.506.3378.

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Medigap Underwriting – Can I Get Approved?

August 15, 2020 By Garrett Ball Leave a Comment

Medigap underwriting will determine if you are approved on a Medigap plan or not. If you haven’t enrolled in a Medigap plan (Medicare Supplement) during your Initial Enrollment Period (When is Medigap open enrollment?), during a Guaranteed Issue Period (When is a Medicare Supplement Guaranteed Issue?), or during your Birthday Rule (only available in some states – Medigap birthday rule states), your acceptance will not automatically be approved. It first must go through a medical underwriting process. This is when the underwriter assigned to your case will make a decision based upon your health status, prior medical history and any upcoming planned treatment or surgeries. Each insurance company uses their own set of Medigap underwriting guidelines. Even the application questions may vary widely. In addition, underwriters must go through rigorous training to become proficient at what they do. They must be experienced in the field of medical terminology and knowledgeable regarding pharmaceutical drugs and medications that the prospective applicants take.

Below are three categories of situations/results of Medigap underwriting on Medigap plans:

Medigap Underwriting: Very Unlikely to be Approved (or Possibly Will Be Immediately Declined)

The underwriter can decline an applicant based on one or more responses to questions on the application. Questions such as, “At any time, have you been medically diagnosed, treated or had surgery for any of the following: congestive heart failure, defibrillator, leukemia, Parkinson’s Disease, Alzheimer’s Disease, dementia, multiple sclerosis, chronic kidney disease or organ transplant?” There are several other conditions in this category, but for sake of brevity here, only some of these are listed. To see all conditions, you would have to refer to specifically to the application itself (which is different with different insurance companies). If you answered “Yes” to any of these questions, you would be immediately declined and not permitted to complete the application process. Some applications may say “Have you ever, instead of “At any time”, but this does not change how you would answer the question.

To give you an idea of what I mean, let’s say Betty Blue wants to enroll in a Medigap Plan G, with ABC Insurance Company. On the application, when she gets to the section on “At any time (or have you ever), she notes that one of the conditions she has is among those on the list. She stops and cannot proceed with the application.

Another reason to be declined would be because of one or more of the medications you currently take. If you are taking one or more medications that are on the insurance company’s “declinable drug list”, your application will likely be declined right away. Each company has their own declinable list, so it is worthwhile to evaluate your options before accepting for sure that companies will decline you. If you use a broker (Why You Should Use a Broker), he/she can help you navigate this process. He/she will be able to call the specific insurance company to ask if a certain drug is declinable or actually has that list at hand to find out, before you spend any time going through the application process.

A hypothetical illustration would be if Jim Smith wants to enroll in Medigap Plan N with Sunshine Insurance Company. He currently takes Eliquis to prevent strokes, as well as using insulin for Type 1 diabetes. He fills out the application but is declined because he takes a blood thinner and insulin for Type 1 diabetes. Sometimes, applications are declined based on the the combination of drugs you are taking.

Some insurance companies have stricter guidelines as far as which drugs you are taking for which diseases/conditions and how many of each type of drug you are on. One company may allow three high blood pressure medications and two diabetes medications. However, another company may only accept two high blood pressure medications with one diabetes medication (see below under #2 for another example).

Medigap Underwriting: Approval Depends on your Medical Records and on the Insurance Company

There is not one strict rule across the board for insurance companies to base their decisions on as far as Medigap underwriting goes. Each company uses their own criteria to approve or decline an applicant. That said, there is generally a 2-3 year “lookback” on the applications for certain conditions or procedures, i.e. heart procedures, stroke, lung problems requiring the use of oxygen, neuropathy, etc. It depends on whether you are currently being treated for one or more of these conditions, or when your last treatment occurred and when you were medically released by your provider.

An example would be that Angie Taylor underwent cardiac ablation caused by atrial fibrillation, 2-1/2 years ago, and was hospitalized for 1 day. She applies for Medigap Plan G with Good Health Insurance Company, but she’s declined as they have a 36-month lookback policy. She would need to wait 6 more months before she can re-apply. Angie doesn’t want to wait and subsequently completes an application with Winstar Insurance Company. She is approved since Winstar only has a two-year lookback policy.

Here’s a different scenario but still the same outcome: Joe has high blood pressure along with Type 2 diabetes but is not on insulin. He’s been taking his medications for more than 2 years. He applies to POP Insurance Company and is approved. Whereas, Jane applies to the same company and has high blood pressure along with Type 2 diabetes, but also takes insulin. She is declined. Again, the criteria is different with each company – some approve if taking insulin, some decline and some companies will not decline you with insulin but the amount you take daily must be under a certain amount.

Should Not Have a Problem Being Approved

This category is the easiest and quickest for the medical underwriter to decide upon. If you are on maintenance type medications or take no medications at all, you will most likely be approved.

Hypothetical Illustration 1: John Green applies to Happy Insurance Company; he currently takes one medication for high blood pressure and two medications for cholesterol. He is approved. The medications John takes are considered “maintenance medications”. In other words, a medication to keep a long-term condition stabilized.

Hypothetical Illustration 2: Nancy Best wants to enroll in a Medigap Plan N with Sowhat Insurance Company. She takes no medications except for some over-the-counter vitamins and supplements. She is approved by the insurance company.

Important Disclaimer: Each insurance company has different guidelines for underwriting including which conditions and/or which medications they will decline. They may also take into consideration when a person started taking a certain drug and the length of time they have been on that drug. The more stable someone is on a medication, the more likely they will be approved.

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65Medicare.org is a leading, independent Medicare insurance agency for people turning 65 and going on Medicare. If you have any questions about this information, you can contact us online or call us at 877.506.3378.

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Medical Underwriting for Medigap Plans

January 8, 2019 By Garrett Ball Leave a Comment

A common misconception is that there is no medical underwriting for a Medigap plan. Many people mistakenly believe that there is an annual open enrollment period, during which you can easily switch from company to company or plan to plan without any restriction or requirement. This is not the case. medigap medical underwriting

To qualify for a Medigap plan, there is a process for getting approved – regardless of when you apply for a plan. The insurance company will determine whether they want to “accept” you, and what the premium will be. To make the determination of qualifying medically, they will conduct a review of your medical history, in addition to requiring your height and weight, and they will likely conduct a phone interview and medication information.

There are some instances during which you are not subjected to medical underwriting:

If you are in an open enrollment period, i.e. just turning 65 or signing up for Part B for the first time
In a “Guaranteed Issue” situation (the insurance cannot refuse to sell you a Medigap plan). Some examples of this are:
- you just left your employer’s health insurance plan
- your current Medigap insurance company went bankrupt
- your Medicare Advantage plan is terminating their plan
- your Medigap company misled you
- you are buying a Medigap policy in CA, OR, and WA and your birthday falls either 30 days before or after this date (Birthday Rule)

What kinds of questions are asked on Medigap applications?

Insurance companies primarily want you to answer medical questions pertaining to the previous two-year period. However, these questions do vary considerably from company to company, and from state to state. The same applies to the types of questions regarding medical conditions or disorders, or any medical equipment you are currently using. Some of these questions, if answered “yes” to, will immediately result in your being declined, as seen below:

Have medical tests, treatment, or surgery been advised but not performed, or is any surgery anticipated? (This excludes mammograms, pap tests, colonoscopies, or PSA tests which were advised for routine screening purposes only).
Do you have nor or in the last 2 years have you been treated for or advised by a medical professional to have treatment or surgery for:
- angina, atherosclerosis, arteriosclerosis, irregular heartbeat, atrial fibrillation, congestive heart failure, angioplasty, stent replacement? (there may be more cardiac conditions listed on the application)
- Diabetes with neuropathy, retinopathy, vascular disease or tobacco use?
- Internal cancer, leukemia, malignant melanoma, Hodgkin’s disease or lymphoma?
- Parkinson’s disease, myasthenia gravis, cerebral palsy, muscular dystrophy, multiple sclerosis or amyotrophic lateral sclerosis (Lou Gehrig’s disease)?
- Paget’s disease, rheumatoid arthritis, disabling arthritis, systemic lupus, osteoporosis with fractures or paralysis?

Will Medications Be A Factor in Declining a Medigap Application?

Even though Medigap plans don’t cover prescription medications at all (they are covered under Part D), the medications you are currently taking could very well be a factor in the underwriter’s decision of whether to approve or decline your application. Each company has their own guidelines as to which drugs are declinable. However, the list of decline drugs is basically the same no matter which company you are dealing with. In addition to specific drugs, there are other factors which may come into play:

– If you take injectable insulin instead of insulin orally; and if you are taking injectable insulin, how many units;

– Whether you are taking more than two blood pressure medications along with certain other medications for coronary artery disease or other heart conditions;

– There are some drugs which can be taken for a wide variety of illnesses and conditions. One drug may be taken for a declinable reason, while you may need to take that same drug for another condition which is not declinable. In that case, you may be required to present documentation from your physician of the precise reason you are taking that medication. An example would be the drug Metoprolol. It is generally taken for atrial fibrillation. However, it may also be taken for high blood pressure in conjunction with other blood pressure medications. In that case, your physician would have to note that in the letter.

The underwriting process usually takes from 7-10 business days. The agent submitting the application will get status updates regularly. Some insurance companies notify both the client and the agent of the decision at the same time by email. Other companies notify the agent who in turn notifies the client, although the client will be getting a letter of the decision by mail. In that letter, they will either be approved, or given the reason(s) why they were declined. The agent is not generally informed of the reason(s) due to HIPPA privacy laws. It is up to the applicant whether to notify the agent or not regarding the reasons why their application was declined.

Lastly, if you are not sure whether you would qualify or not for a Medigap policy, you can always apply. There is no cost associated with submitting your application. Even if you are declined, you can reapply later with the same company. Or, you can try a different company that may be more lenient on underwriting requirements. An experienced independent broker can help you evaluate the options, choose one that gives you the best chance at approval and exhaust all options until you, in most cases, can find a company that will work.

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65Medicare.org is a leading, independent Medicare insurance agency for people turning 65 and going on Medicare. If you have any questions about this information, you can contact us online or call us at 877.506.3378.

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