Over the past few years, there have been several significant changes to Medicare Supplement insurance (also known as Medigap) in Michigan. Most notably, Plan F and Plan C are being phased out in the state of MI, meaning that they are no longer available to new enrollees, and Plans F and G are experiencing rate changes nationwide.
This does not mean that you have to switch plans if you already have a Plan F or Plan C in Michigan; you may keep it! However, if you are a Plan F or Plan G holder, and really don’t need all the benefits that your plan provides, you may want to switch to a different Medigap plan if you live in Michigan to avoid higher premiums. Or perhaps you realize that your current plan does not offer enough benefits for your current health situation and need more coverage. Maybe you just want to work with a different insurer. All of these are reasons why you might be considering changing your Medicare Supplement plan.
You might not know if that option is available to you, when to do it, or how to do it. Read on to learn more about what you need to know before switching to a different Medigap plan!
All Medicare Supplement plan holders can apply to change plans at any time as long as they are currently enrolled in Medicare Part A and B. However, the plan is free to not accept you or may charge you more money unless you have guaranteed issue rights.
Guaranteed issue rights means that insurers cannot deny you coverage or raise your rates because of a pre-existing condition. Not everyone enrolled in a Medicare Supplement plan has guaranteed issue rights, however.
Here are some situations where guaranteed issue rights may apply to you if you live in Michigan:
- If it is within your Medigap Open Enrollment Period, which begins the first month you have Medicare Part B and are age 65 or older
- If you have a Medicare Advantage plan, and the insurance company is no longer servicing your area
- If your Medicare Advantage plan has been discontinued
- If you moved out of your Medicare Advantage plan’s service area
- If you are enrolled in Original Medicare and your employer coverage is ending
- If you are enrolled in Original Medicare and a Medicare SELECT plan, and you move out of the Medicare SELECT plan’s service area
- If your Medicare Supplement plan’s insurer went bankrupt
- If you end your Medicare Supplement coverage because your insurer was not compliant with the law
If any of the above scenarios describe your situation, you are eligible to switch Michigan Medigap plans without fear of being denied coverage or charged more for the same coverage. Remember that you can technically change plans at any time even if you do not have guaranteed issue rights, but it may not be worth the amount you could potentially end up paying for coverage.
In Michigan, when you change plans, you may need to wait for coverage to kick in for up to six months.
Note that you may have the option of getting a “free look period” when you switch plans. Michigan residents typically get 30 days to decide if you like your new plan and want to keep it! The only downside is that during that month, you pay both your old plan’s premium and your new plan’s premium.
If you want to change your Medicare Supplement plan, contact the insurance company selling the plan and explain what you want to do. They will guide you through the application process and give you any other information you need to know. When/If they accept your application, you will need to call your current insurer and cancel your coverage. Make sure to cancel it in writing, following all of the appropriate instructions. Your insurance company cannot cancel a plan for you.
Remember that if you cancel your Medigap Plan C or Plan F, you cannot get it back.
Need some help changing your Medicare Supplement plan? Want to browse Medigap plans in Michigan to explore your options and find the right plan for your health needs and budget? You can enroll online in minutes at enrollmedicare.com!
Figuring out what kind of healthcare coverage you need can be confusing. Here’s everything you need to know about Medicare Supplement, or Medigap, insurance in Michigan!
What is Michigan Medicare Supplement, and Why Do You Need It?
Original Medicare (Parts A and B) is the health insurance program offered by the federal government. Millions of elderly Michigan residents rely on Medicare for medical coverage, but Parts A and B are not free, and the coverage they offer is far from comprehensive. Original Medicare only pays for 80% of approved healthcare costs. The other 20% will be left up to you. While 20% may not seem like a lot, for surgeries, treatments, hospital stays, deductibles, copays, and more, 20% can be a financially devastating amount to most average senior retirees. For example, 20% of a $45,000 knee replacement surgery is $9,000, and that does not include the cost of a hospital stay, rehabilitation, copays, follow-up visits, and pain medications. The majority of Medicare beneficiaries in Michigan don’t have $9,000 just lying around, particularly if they are no longer receiving income other than Social Security. There is no cap on the amount that you can spend each year; if you have a year marked by poor health, then you could potentially pay tens of thousands of dollars out of pocket.
That’s where Medicare Supplement insurance comes in. Medicare Supplement Plans, also commonly referred to as Medigap Plans in Michigan, are designed to fill in these expensive gaps in Original Medicare. These plans, sold by private insurance companies, pay for the remaining cost of copays, coinsurance, deductibles, and other things that Medicare does not fully cover. Medigap Plans also pay for some additional services that Medicare does not fully cover at all. This type of insurance does not replace your Original Medicare, but supplements it instead. When you have a Medicare Supplement Plan, and incur a healthcare cost, your Original Medicare will pay its share first, and then your Medicare Supplement Plan will cover the rest.
Having a Medicare Supplement Plan can help you save significantly on healthcare costs and give you the peace of mind that no matter what health situations you may face, you are protected financially.
Who Can Purchase a Medicare Supplement Plan in Michigan?
In Michigan, in order to be eligible for a Medicare Supplement Plan, you have to already be enrolled in Original Medicare Parts A and B. This means you must be a U.S. citizen or a permanent legal resident for at least five continuous years. You need to be 65 or older, or diagnosed with end stage renal disease (kidney failure), or receiving disability benefits, or diagnosed with ALS (Lou Gehrig’s disease). If you have worked ten years or more and paid Medicare taxes, and meet the stated requirements, you are automatically enrolled in Part A and B (Part A is premium-free; for Part B you pay a monthly premium).
In some states, you may be able to purchase a Medicare Supplement Plan if you are under 65, but the premium may be higher, and the insurer may be able to evaluate you medically and screen you for certain conditions, which could affect your coverage.
Medicare Supplement vs Medicare Advantage in Michigan
Medicare Supplement Plans and Medicare Advantage Plans are two ways of getting the essential coverage that Original Medicare does not offer. Medicare Supplement, or Medigap, Plans supplement the gaps left by Original Medicare, while Medicare Advantage Plans (Part C) replaces the benefits of Original Medicare. Part C Plans are alternative ways of recieving these benefits. These plans are much like private health insurance, covering most services after copays, and must provide at least the same level of coverage that Original Medicare does. These plans may also include additional benefits. However, about 80% of Americans choose a Medicare Supplement Plan, as it gives you the freedom to see any doctor or provider, anywhere in the U.S., without a referral, that accepts Medicare (most do).
Medicare Supplement Plans and Medicare Advantage Plans cannot work together. It is illegal for any insurer to sell you a Medigap Plan if you currently have a Medicare Advantage Plan unless you are switching back to Original Medicare.
The Plan Types Explained & Which are Available in Michigan
There are eight types of Medicare Supplement Plans available: A, B, D, G, K, L, M, and N (as of 2020; Plan F and Plan C are being phased out and can no longer be sold to new enrollees). In 2010, these plans were standardized by the federal government in all but three states (Massachussetts, Minnesota, Winsconsin), meaning that a plan type with the same letter will offer the exact same benefits, anywhere you are. The only difference is the price. For example, let’s say one insurer is selling Medigap Plan G for $100. Another insurer in another state is selling Medigap Plan G for $130. Both Plan Gs are identical and will offer you the same coverage; the only difference is the price. Think of it like buying gas. Any gas station you go to basically sells the same product, but at different prices.
Some plan types offer more coverage than others, which is a factor that affects how much you can expect to pay. Plan G is the most comprehensive of the eight plan types and therefore will be more expensive than Plan A (the least comprehensive), for example. Insurance companies do not have to sell all of these plan types, but if they sell any Medigap Plan, they have to offer to sell Plan A.
Important Facts You Should Know About Michigan Medicare Supplement
- All Michigan Medigap Plans are guaranteed renewable for life. This means that as long as you pay your premiums on time, you cannot be denied coverage due to your health or age, even if you develop a serious condition while on the plan.
- In Michigan, Medicare Supplement Plans do not cover vision, dental, hearing, or private-duty nursing insurance, so you may need to purchase additional health insurance for those needs.
- If you have Medigap policy, you will continue to pay your Part B premium in addition to the Medigap policy premium.
- Medicare Supplement Plans only cover individuals, not spouses or families; each individual must purchase their own plan if they want coverage.
- There could be penalties for dropping your Medicare Supplement Plan if you enroll late in your new plan.
Best Time To Buy Medicare Supplement
Ideally, you should buy Medicare Supplement coverage during Michigan's Medigap Open Enrollment Period. This period lasts for six months and begins on the first day of the month when you are 65 and older and enrolled in Part B Medicare.
If you do not enroll during this period, insurers can deny you coverage or raise prices based on your health status, but if you enroll within your OEP then you are protected, and your plan is guaranteed renewable for life.
How To Choose The Right Michigan Medicare Supplement Plan
Selecting the best Medicare Supplement Plan for your health needs and budget can be overwhelming with all of the options available to you. That’s why it’s best to work with an experienced agent who can help you find a policy with the perfect amount of coverage! Put in your zip code so we can give you a free Michigan Medicacare Supplement quote and help you get the coverage you need.
Medicare Supplement insurance, also known in Michigan as Medigap, is a type of supplemental insurance that helps cover some of the health care costs not covered by Original Medicare Parts A & B if you live in Michigan.
Many people reach retirement expecting Medicare to pay all of their medical bills, but Medicare has out-of-pocket costs like copays, deductibles, and coinsurance. These out-of-pocket costs can be up to thousands of dollars each year if you are in poor health, if you have a chronic condition that requires specialized care, or if you are hospitalized multiple times. Even senior adults in Michigan who are relatively healthy are often on lower incomes or fixed incomes and cannot afford to pay the extra costs. That’s why Medigap insurance is available in Michigan and extremely important. These plans pay for the out-of-pocket costs that Medicare does not cover. But these plans come with monthly premiums. Are they expensive? Is getting a Medicare Supplement plan worth it? What factors affect your Medicare Supplement plan costs if you live in the state of Michigan?
There are technically 10 standardized Medigap plans in MI that each pay for a different amount of covered services. Because Plans C and F have been phased out, only 8 plans are available to new enrollees – Plan A, Plan B, Plan D, Plan G, Plan K, Plan L, Plan M, and Plan N.
Because these plans are standardized, it means that plans with the same letter are the same product with the same benefits, regardless of what carrier is selling the plan or where you purchase the plan from. The only difference is the price. A Plan G sold by Aetna in one part of Michigan carries the same exact benefits as a Plan G sold by Humana in another part of Michigan, just like if you get gas for your car at a Shell station, it’s the same exact gas as the Wawa down the road is selling; it’s just a different price. Some carriers may offer additional incentives to purchase (such as discounts for non-smokers or people who pay annually instead of monthly), but the basic plan types themselves are the same.
Individual insurance carriers can set the cost for plan premiums, and they do so in Michigan using one of three rating methods:
- Community-rated. This rating method is also known as No-Age-Rated pricing. Insurers charge each plan beneficiary an identical monthly premium despite their age. The premiums may increase as a result of inflation or other factors, but not because you are getting older. Community-rated plans tend to be cheaper than attained-age-rated plans, where you pay higher premiums as you age. For example, Mr. Jim is 65 years old, and his premium for Plan N is $150. Mr. Jeff, who is 80 years old, also has a premium of $150 for Plan N, because the plan is community-rated and everyone is charged the same amount.
- Issue-age-rated. Using this rating method, insurers charge plan beneficiaries premiums based on their age when they first enroll in the Medigap plan. Premiums are lower for younger beneficiaries, but the premiums will not increase as the beneficiary ages. For example, Mr. Jim enrolls in Plan N when he is 65 years old and pays a monthly premium of $150. Mr. Jeff enrolls in Plan N when he is 80 years old and pays a monthly premium of $230, because older adults pay higher premiums.
- Attained-age-rated. This rating method sets premiums for beneficiaries based on their current age, like issue-age-rated plans, but premiums increase as you age. Every buyer will experience rate increases as they age. For example, Mr. Jim enrolls in Plan N when he is 65 years old, and pays a premium of $150, but when he is 75 years old, he is paying $200. Mr. Jeff enrolls in Plan N when he is 80 years old and pays $230, but when he is 85, he is paying $250.
Age can affect your Medicare Supplement plan costs, but so can factors like high deductibles and whether or not you have a guaranteed issue right. Guaranteed issue rights mean that insurers cannot raise your rates because of a pre-existing condition you may have - as long as you meet certain criteria required by the state of Michigan.
In Michigan, Medigap plans allow you to choose your own provider.
Note than all Medigap plan holders in MI are required to continue to pay their Part B premiums in addition to their Medigap plan premiums. In Michigan, Medigap plans do not replace your Part A and Part B coverage; they simply supplement it, meaning that you have to pay premiums for both sides of your coverage (Part A is premium-free for most Americans).
Looking to enroll in a Michigan Medigap plan that fits your health needs and budget? EnrollMedicare.com can help you learn everything you need to know about Medicare Supplement plan costs. You can find the best coverage and enroll in a plan, entirely online, within minutes! No need to speak to an agent (unless you want to). Compare plans from the nation’s top carriers all in one place from the comfort, safety, and convenience of your own home! Visit our website today and provide us with a few details so we can match you with the perfect plan.
Medigap Coverage Related Articles
Why Do You Need Medicare Supplement Plans Along with Medicare in Michigan?
When looking over the different parts of Medicare coverage and considering your options in MI, you may find yourself wondering just what parts of the plan you generally need.Read More »
Michigan Medicare Plan F vs. Plan G
When you’re signing up for Medicare Supplement Plans in Michigan (Medigap Plans), it can be challenging to determine which is the best plan because there are so many options.Read More »
These 5 Facts About Medicare Supplement in Michigan Will Shock You
Think you understand Michigan Medicare Supplement Plans? Test your knowledge with these 5 uncommonly known details!Read More »