Before you buy a Medicare supplement policy, find out if you have other options for paying your out-of-pocket Medicare costs. The following plans and programs may help you pay the costs.
Group plans for employees
If you stay at your job after becoming eligible for Medicare and still have health insurance through your job, you probably won’t need Medicare supplemental insurance. The same is true if you have health coverage through a health plan from your spouse’s employer.
Some employers offer coverage to their retired employees through a group Medicare supplement policy or a Medicare Advantage plan. Because health plans work differently, ask your employer’s benefits coordinator how well the plan covers the gaps in parts of Medicare coverage. Then make a decision about Medicare supplement insurance.
COBRA coverage from an employer plan
Federal and state laws allow people who leave their jobs to continue their employer-sponsored health coverage for a certain period. Consider the following:
- You have eight months after your employment ends to sign up for Medicare. If you don’t sign up during those eight months, you may have to pay a penalty when you sign up.
- If you are in your initial enrollment period for Medicare, you must enroll in Medicare during that period to avoid a possible penalty.
- If you don’t buy a Medicare supplement policy during your open enrollment period, you will be able to buy a Medicare supplement plan within 63 days after losing your COBRA coverage.
Talk to your employer about COBRA and Medicare eligibility.
Medicaid
Medicaid is a state and federal program that pays for health coverage for people with low incomes. If you qualify for Medicaid, the state will pay your Medicare insurance premiums and any out-of-pocket costs.
Medicaid will also pay for some services that Medicare doesn’t cover. If you have Medicaid, you do not need Medicare supplement insurance.
Medicare Savings Programs
Medicaid-sponsored Medicare Savings Programs pay for Medicare insurance premiums, deductibles, and coinsurance for people who qualify. These programs allow people to use their savings to cover other expenses or to buy more coverage.
Medicare savings programs are as follows:
- The Qualified Medicare Beneficiary (QMB) Program.
- The Medicare Program for Low-Income Beneficiaries (Specified Low-Income Medicare Beneficiary –SLMB).
- The Qualified Individuals (QI) Program.
- The Qualified Disabled Working Individuals (QDWI) Program.
The federal QMB program pays your Medicare Part B insurance premium and covers all Medicare deductibles and copays. You do not need Medicare supplemental insurance if you are in the QMB program.
The other Medicare Savings Programs pay your Medicare Part A or Part B insurance premiums. You may need a Medicare supplement policy to help cover your other expenses.
Your rights
Open Enrollment for Seniors 65 and Older
The open enrollment period for Medicare supplement plans is a six-month period during which you can purchase any Medicare supplement plan offered in Texas. During this period, companies must sell you a policy, even if you have health problems. The open enrollment period begins when you enroll in Medicare Part B. You must have both Medicare Part A and Part B to buy a Medicare supplement policy.
You may use your open enrollment rights more than once during these six months. For example, you can change your mind about a policy you bought, cancel it, and buy any other Medicare supplement policy.
Although companies must sell you a policy during the open enrollment period, they may require a waiting period of up to six months before they start covering your pre-existing conditions. However, there is no waiting period if you are 65 or older and had prior coverage.
Pre-existing conditions are those for which you received treatment or medical advice from a doctor within the previous six months.
Open enrollment for Texans with disabilities
People under age 65 who receive Medicare due to disabilities have a six-month open enrollment period that begins the day they sign up for Medicare Part B. This open enrollment right only applies to Medicare Supplement Plan A.
Note: People who have Medicare due to disabilities have another open enrollment period during the first six months after they turn 65.
Guaranteed issue right
You may be entitled to purchase a Medicare supplement policy outside of open enrollment if you lose certain types of health coverage. This is called a guaranteed issue.
For seniors age 65 and older, the guaranteed issue right applies to Medicare Supplement Plans A, B, C, F (including Plan F with a high deductible), K, and L.
Texans with disabilities under the age of 65 who enroll in Medicare Part B have guaranteed issue rights, but only for Medicare Supplement Plan A.
People who lose Medicaid due to a change in their financial situation are also entitled to a guaranteed issue to purchase a Medicare supplement policy.
The guaranteed issue right is valid for 63 days from the date coverage ends or from the date of the notice that coverage will end, whichever is later. Companies cannot impose restrictions, such as waiting periods for pre-existing conditions, or exclusions for these policies. You must provide the company with proof that you lost coverage. People usually do this with a letter from the company notifying them that their coverage will end.
For more information about guaranteed issue entitlement, read Selecting a Medigap Policy: A Guide for People with Medicare.
“Free trial for 30 days
You can return your Medicare supplement policy within 30 days of receiving it and your money will be refunded to you with no questions asked. Be sure to keep proof of the date you received the policy. Read the policy as soon as you receive it. If you return the policy to the company, send it by certified mail, return receipt requested, as proof that you returned it within the 30-day limit.
The 30-day “free trial” period does not apply to Medicare Advantage. If you leave a Medicare supplement plan to join a Medicare Advantage plan, you may not be able to get your Medicare supplement policy back.
Renewals of your policy
All Medicare supplement policies have a renewal guarantee. This means that a company cannot cancel your policy or refuse to renew it unless you made false statements on your application or failed to pay your insurance premium.
An insurance company may increase your insurance premium once a year. Also, if you have an attained age policy, the company may increase your insurance premium on your birthday.
Suspension of policies
If you become eligible for Medicaid, you can request that your Medicare supplement benefits and insurance premiums be suspended for up to two years. You must notify your company within 90 days of becoming eligible. If you lose your eligibility for Medicaid, the policy will be automatically reinstated.
If you lose Medicaid eligibility within two years and want to reinstate your Medicare Supplement policy, you must contact your company within 90 days of losing eligibility. After two years, you will need to reapply with the company if you want to reinstate your policy.
Claims
Physicians who accept Medicare must submit Medicare claims to the Medicare claims contractor. If you get a bill, review your Medicare Summary Notice and what the company paid to see if you owe anything.
Medicare supplement policies only pay for services that Medicare deems medically necessary. If Medicare denies a claim, you have the right to appeal the decision. The appeals process and the deadline for requesting an appeal are described in your summary notice.
Texas law requires insurance companies to pay claims quickly. If your Medicare supplement company refuses to pay a claim for a Medicare-approved charge or delays payment of your claims, you, your doctor, or the hospital can file a complaint with TDI.
