Many Medicare subscribers find that original Medicare doesn’t cover everything they wish it did. It provides very basic insurance and sometimes supplemental insurance is required as well. The Aetna Medicare Supplement Plans for 2021 can provide that additional coverage.
They are like any other Medicare supplement plans. In fact, the benefits (coverage) are exactly the same. Medicare controls what coverage is included in each plan, ensuring that you get the same coverage regardless of where you buy your supplemental plan from. You won’t see the rates staying the same between insurance companies, however. That’s because the individual companies get to set their own rates.
Key parts of Medicare Supplement coverage include:
- Medigap covers the gap costs.
- Medicare supplement plans are available in all states.
- There are three pricing structures.
- Some providers provide discounts.
- Providers cannot cause you to wait for coverage to begin.
- The one-time enrollment period is the best time to apply, but it only lasts six months.
- Newly eligible seniors cannot purchase Medigap plans that include Part B deductibles.
Traditional Medicare covers a large portion of medical expenses, which help out the recipients. However, it does not cover all medical expenses, and these can quickly begin to add up, especially for major treatments, surgeries, or long-term care. Enrollees can then be stuck with a massive bill, even after Medicare pays their portion.
It is common for seniors to need help with these additional expenses, also referred to as the ‘gap.’ This includes coinsurance, copayments, deductibles, and other medical procedures that may not be covered by traditional Medicare. For instance, emergency treatment in a foreign country.
Over 33% of Medicare beneficiaries purchase Medigap coverage, also known as Medicare Supplement plans. These are plans designed to offer gap coverage to reduce, and in some cases, eliminate out of pocket costs.
Where can I purchase Medigap insurance?
All states offer Medigap plans through private insurance companies. In 2019, it was reported by America’s Health Insurance Plans (AHIP) that Medigap enrollment totals increased from 11.6 million (2014) to 13.5 million (2017).
In most states, insurance providers are required to offer standardized policies for all letter plans from A through N, and they all follow set federal and state laws. All of the individual plan benefits offered between insurance companies must provide the same basic benefits. For instance, Plan G will provide the same base benefits no matter what company or location it is offered in.
There is a total of 10 letter plans, including:
- Plan A
- Plan B
- Plan C
- Plan D
- Plan F
- Plan G
- Plan K
- Plan L
- Plan M
- Plan N
Plan C and F are no longer offered to newly eligible enrollees, as discussed in more detail below. Also, Wisconsin, Minnesota, and Massachusetts use a different standardized method.
There will be some states that will not provide the same or all Medigap plans to residents. For instance, some states off Medicare SELECT, which is a Medigap policy requiring the holder to use a certain hospital, and sometimes certain doctors. Medicare SELECT is offered in all Medicare supplement plans, and are typically cheaper than the standard Medigap insurance coverage. By opting into Medicare SELECT, you are covered for in-network healthcare providers. Services from out of network providers are not covered unless it’s an emergency.
You should know, insurance providers selling Medigap coverage is not legally required to provide all Medigap policies. Although, they are required to offer Medicare Plan A as a minimum. Additionally, they must offer either Plan G or Plan D drug coverage for newly eligible enrollees, while offering Plan F or Plan C to those that became eligible prior to 2020.
Does Medigap Insurance have gaps?
Medigap plans are designed to help cover part or all of the out of expense for medical services covered by Medicare. However, if Medicare does not cover the service, it will not be covered by Medigap either. This is because Medigap covers the expenses left over after Medicare pays its portion.
Some of the medical expenses not covered include dental, vision, and long-term nursing home care, private nursing care, hearing aids, prescriptions, and eyeglasses. For those who purchased Medigap coverage before 2006, prescription drugs were included. If you enrolled in one of these plans and still have it, they continue to cover prescriptions. However, for Medigap coverage after 2006, they no longer include drug coverage.
The following coverage types are not compatible with a Medigap policy:
- Indian health services
- Union or employer-based plans
- Medicare Advantage plans
- Veterans benefits
- Medicare prescription plans – an individual plan will be needed.
A Medigap policy is only good for individuals, and do not include spouses or dependents. If you’re both eligible to receive Medicare, you must apply separately and select individual plans. Although some insurance companies will offer a household discount that reduces the monthly premium when purchasing multiple plans within the home.
Will new Medigap beneficiaries get Part B deductible coverage?
Medicare Part B deductibles are covered under two Medicare Supplement plans: Plan C and Plan F. In 2015, the MACRA (HR2) was signed. Therefore, these two plans cannot be offered to new Medigap beneficiaries after January 1st, 2020.
However, for those that were already enrolled in either of these plans, they will continue to receive the same benefits. Also, those that were eligible to enroll in Medicare before January 1st, 2020, may still purchase a Plan C or Plan F. However, if the applicant is past their one-time open enrollment period, the carrier will probably determine eligibility through medical underwriting.
Those that become eligible to enroll in Medicare in or after 2020 will not qualify for either plan. The concept behind this decision was to phase out the Part B deductible from being covered, also known as “first-dollar coverage.” This ensures that people must invest some of their own money in healthcare, reducing the overuse of the Medigap policy. There are plans that still cover most out of pocket expenses, such as Plan G, which covers everything except the Part B deductible each year.
In 2020, the deductible for Part B is $198 but can change each year. The Medicare benefit period only covers inpatient services through Part A.
How are prices set by Medigap providers?
Medigap plans are only regulated on their standardized benefits, not pricing. Because of this, rates for the same plan can vary between companies. They may include additional perks that make the higher premium justified. It is recommended to compare rates when shopping around.
The following are the three methods used for setting Medigap premiums:
Issue Age Rated:
The purchaser’s age at the time of enrollment determines the price. Therefore, the older a person is when enrolling in the plan, the more expensive the premiums will be. In addition, the rate will not increase over time as the purchaser ages. It’s best to enroll early as possible for this type of Medicare supplement coverage to keep premiums as low as possible.
The premium is not determined by age, and rates are the same for a 65-year-old or an 80-year-old. However, the premium pricing can change over time, with all enrollees paying the same price increase. There are 8 states which require all Medigap policies to be community rated.
Attained Age Rated:
The premium for this type of plan will continue to increase as the purchaser ages. When you first become eligible for Medigap insurance, it may be the cheapest option. Although the older you get, the higher the premium goes, combined with other factors like inflation and the cost of medical services overall.
Remember, in the majority of states, only the initial enrollment period offers guarantee issue rights for the six-month period. This window begins on the first day of the month you turn 65. If you had employer coverage when turning 65, then the enrollment period begins when you apply for Medicare Part B. There may be other limited periods of enrollment depending on your state.
Unlike Medicare Advantage, Traditional Medicare, and Medicare D, there are no annual open enrollment periods for Medigap. Therefore, if you do not enroll within the first six-month window, you could have a higher premium when enrolling.
If you are in poor health, you could be denied coverage after the one-time enrollment period because insurance companies can ask based medical questions through an underwriting process.
How can I get cheaper Medicare supplement Insurance?
To get the lowest Medigap premiums, you must enroll during the one-time open enrollment period. This not only gives you the lowest rate, but you have also guaranteed issue rights, and medical conditions cannot change the price.
In addition to the open enrollment window, some Medigap providers offer different types of discounts. To determine if there are any discounts you qualify for, you will need to check with the different insurance companies. However, discounts may include a household discount, married discounts, discounts for non-smokers, women, or just for paying premiums annually vs. monthly.
Your state may offer a health insurance assistance program that you can qualify for. You can ask for an updated list of qualified private insurers and Medigap information.
What is the best time to buy a Medigap plan?
The one-time open enrollment window is the best time for purchasing a Medigap policy. This window starts on the first day of the month that you turn 65 and lasts six months. This is when you first become eligible to enroll within Medicare Part A and B. To qualify for Medigap, you must first have both Part A and B. During this period, you cannot be denied the plan of your choice for medical reasons, and they cannot charge more for existing conditions.
If you are disabled and qualify for Medicare, you could have guaranteed issue rights for enrolling before age 65. While this is an option in most states, the premiums are typically higher for those under 65. You should look into the healthcare regulations or your state. You can also reach out to the Department of Insurance or SHIP to get information.
If you procrastinate until your enrollment period passes, insurance companies have the option of asking questions and charging a higher premium or denying enrollment based on their underwriting requirements. Medigap plans have no federal obligations for accepting new policies outside of that initial six-month period.
States have some special guaranteed issue windows that offer limited enrollment periods. However, states can set Medigap regulations.
Massachusetts residents have annual guaranteed issue periods that last February 1st to March 31st.
Connecticut and New York do not allow medical underwriting, no matter when enrolling.
Missouri has an ‘anniversary rule’ that enables enrollees to change between Medigap providers for the same letter plan with a guarantee issue each year. This limited window starts 30 days prior to the initial purchasing date and lasts for 30 days after.
Maine requires insurance companies to select one month each year to provide guaranteed issue rights for Plan A, without medical history being a deciding factor.
Washington State lets enrollees change Medigap plans anytime after having coverage for 90 days. However, those with Medigap Plan A can only change to another Plan A. Those with any other plan can switch between any plan B through N.
Oregon and California give enrollees an annual period each year that lasts 30 days after their birthday, long as they have been covered for at least 90 days. During this time, plans can be changed with another of equal or lesser benefits and avoid medical underwriting.
You can reach out to the Department of Insurance or SHIP to get the latest information about your state’s Medigap rules and regulations.
Do I have to wait before Medigap Insurance goes into effect?
Insurance companies are not allowed to force you to wait prior to starting general coverage. However, they have the ability to delay or deny coverage of out of pocket expenses for pre-existing conditions for six months, known as the ‘pre-existing waiting period.’
The waiting period may be avoidable or shortened by those that have guaranteed issue or other creditable coverage. Again, for additional information, you can reach out to your state or read the Choosing a Medigap Policy guide.
Rate increases do happen each year with Medigap insurance. That doesn’t mean you will be charged sky-high rates just because the companies can choose any figure they like. They still have to stay competitive, and there are plenty of options to choose from. Aetna is a preferred choice for many Medicare subscribers because it has been in the insurance business for a long time. But like any insurance company, it’s a good idea to look at their rates and see how they stack up.
You also need to take a look at the plans they are offering. They may not offer the full range of supplement plans for Medicare subscribers. You probably want to look at the supplement plans first and find the one that is going to fit you best. Then compare rates on that plan across several insurance providers, Aetna included.
Keep in mind that the Aetna Medicare Supplement Plans for 2019 are likely to be slightly different from the plans you have available to you now. The coverage may change a bit, as Medicare does make some changes to its plan every few years or so. You will probably still enjoy the basic coverage provided by all plans- Part A coinsurance coverage. But some of the details of other coverage items may change between plans.
When choosing a plan, you want to find one that covers as much of your medical expenses as possible and perhaps a bit more. Be careful about going for a full-coverage plan like Plan F, however. This can be an incredibly expensive choice, and most people don’t even benefit from all that coverage. As you plan for your medical coverage for 2017 and beyond, you should take note of your changing health care needs. You aren’t likely to have exactly the same medical needs I a few years as you do now. You may not be able to predict exactly what you are facing, but you can plan to have a little extra coverage to take care of whatever crops up.
Your doctor can help you determine what kinds of medical problems you should plan for, and you can find a plan that works for you based on that information. Almost no one saves money by sticking with the same Medicare supplement plan forever. So you can start looking ahead and researching the Aetna Medicare Supplement Plans for 2021 now. You may find a plan that will save you some money in the years to come.