There is a difference between a Special Election Period and a Guaranteed Issue Period. A Special Election Period (SEP) allows you to leave your Medicare Advantage Plan. A Guaranteed Issue Period (GI) allows you to purchase certain Medicare Supplement Policies regardless of your health.
You have a GI right in these situations:
1. Your Retiree Plan is Terminated
If your Retiree Plan or COBRA terminates, then you’ll be able to purchase certain Medigap plans. In order for this right to apply, Medicare must have been primary. This federal right does not apply if you got terminated because you didn’t pay your premium.
2. Your employer reduces Retiree Benefits or you lose Eligibility
In California, you also have the right to purchase certain Medicare Supplement Plans if your retiree plan stops providing secondary benefits to Medicare. This is even if your plan keeps providing other benefits. Additionally, you’ll have a GI right if you lose your coverage because of a divorce or death of a spouse or family member, or your retiree plan stops paying the Medicare Part B’s coinsurance.
3. Your Premium, Copays, or Cost Sharing increase, Your Benefits are Reduced, or your Provider is Terminated
In California (but not other states), you have the right to buy a Medigap plan if your Medicare Advantage Plan increases its premium, cost sharing, reduces benefits, or terminates a provider.
But, these GI rules can seem a bit complicated.
You can only purchase a Medicare Supplement Plan from the same Medicare Advantage (MA) organization you enrolled in if it sells one, or from the parent company or network that contracts with the MA plan.
But even if your Medicare Advantage Plan doesn’t sell Medigap policies, other companies that do business in California must sell you a Medigap IF your Medicare Advantage Plan increased your copayments or premium by 15% or more, reduced any of your benefits (even ones you don’t use), or terminated your medical provider (who was treating you).
If one of these happens, you’ll have 63 days to get one of the guaranteed issue Medigap policies. The clock starts ticking when you are notified of any of the above. The problem is that you can only use this right during certain periods when you’re allowed to disenroll from your Medicare Advantage Plan, which is usually the Annual Enrollment Period (AEP).
AEP starts on October 15 and ends on December 7 each year. If you (like most) choose to disenroll during AEP, your Medicare Advantage plan will terminate on January 1st of the following year.
Your Medicare Advantage Plan might discontinue its contract with a provider anytime during the year. This means, that even though you may have the GI right to buy a Medigap when a provider no longer has a contract with your MA plan, you may not have a corresponding right to disenroll from that MA plan. In some cases, Medicare may grant a Special Election Period to allow you to disenroll, but if not, you will not be able to exercise this right mid-year.
Keep in mind that if your provider leaves the plan voluntarily (usually for monetary reasons) then this right does NOT apply.
Additionally, there are usually some hoops to jump through. Most of the insurance companies will require proof that you disenrolled before they accept your Medigap application. You’ll want to work with someone (like us) who is very experienced in this to avoid winding up without either a Medicare Advantage Plan or a Medigap plan on January 1.
4. Moving out of the service area
You have the right to purchase certain Medigap plans if you move out of the service area that your Medicare Advantage Plan or PACE plan covers. Because you’ll lose coverage of your existing plan, you’ll be able to get a Medicare Supplement Policy. This is even if your current company offers Medicare Advantage or PACE in your new area.
Be careful because often when you call to update your address, the plan will try to enroll you in your new area. If you enroll with them, you’ll lose this GI right.
Additionally, you should know that it can be difficult to find an agent or broker to help you with this type of change because many insurance companies will not compensate the agent or broker for this type of transaction.
5. Misrepresentation, Fraud, Contract Loss, or Failure to Meet Contractual Obligations
You have the GI right to obtain certain Medicare Supplement Plans if your Medicare Advantage plan, Medicare SELECT Plan, PACE provider or any other health plan under contract with Medicare:
- Commits fraud
- Ends or loses its contract with Medicare
- Misrepresents the plan you bought (this includes if you worked with a broker or agent)
- The federal government determines that the plan has not met its contractual obligations to Medicare beneficiaries
6. Medicare Trial Right: First Eligible
You have the right to purchase certain Medicare Supplement plans during this Trial Right. This GI right works if you joined a Medicare Advantage plan or PACE organization when you first became eligible for Medicare at age 65, and you want to switch to a Medigap policy during your first 12 months in the Medicare Advantage plan or PACE organization.
Be careful with this trial right because it only applies if your Part A and Part B effective dates MATCH, if you started Medicare the first MONTH you were eligible (for most people it’s your birthday month) AND your Medicare Advantage Plan started on the same month and year as your Part A and Part B. If you delayed getting Medicare, this right won’t apply.
7. Medicare Trial Period: Switch
You also have the right to purchase certain Medicare Supplement plans during your Medicare Trial Right Switching Period. You can only use this right if you have never had a Medicare Advantage Plan before. If you qualify due to this right, you can switch from a Medigap policy to one of the following plans:
- Medicare Advantage plan
- PACE organization
- Medicare SELECT plan
- Any other health care organization that contracts with Medicare, for the first time since becoming eligible for Medicare, and you disenroll from that plan within the first 12 months.
You can return to your previous Medigap policy (if it is still available) within 12 months of joining the new plan. Medicare will generally give you a Special Election Period (SEP) to disenroll in your Medicare Advantage Plan if you use this right. You’ll also be able to get a Prescription Drug Plan during this SEP. This means you won’t have to wait until the AEP to exercise this right.
If your former plan is no longer available, you can choose from plans A, B, D, G, K, L, M, or N from any company that offers these plans in your state.
If you turned 65 before January 1, 2020, or if you are younger but don’t have End Stage Renal Disease, and you became eligible for Medicare before January 1, 2020, you can buy plans C or F
You can apply 60 days before your coverage will end and not later than 63 days after it ends.
For help, contact us to speak with a licensed agent at 866-445-6683 (TTY 711) M-F 9 am to 5 pm