Switching from Medicare Advantage back to Original Medicare can be a bit tricky due to election periods and underwriting.
The last thing you want is to leave your Medicare Advantage plan and then find out you can’t qualify for Medigap. It’s smart to work with a broker to process the change in the right order and use the right election periods. A broker can also help you determine whether you are eligible for other viable coverage first.
Many people try out Medicare Advantage plans because they offer lower premiums than Medigap. Medicare beneficiaries are also lured by promised of minor extra benefits like vision exams and eyeglasses or gym memberships.
So then why would someone enrolled in a Medicare Advantage plan want to switch back to Original Medicare? There are a number of reasons that we frequently see here at our agency.
Reasons for Switching from Medicare Advantage to Medigap
Probably the most common is that an important doctor drops from the network. Advantage plans generally have networks of doctors that members must use. Doctors can come and go from the networks as their contracts come up for renewal. If a trusted doctor leaves the network, that beneficiary may want to return to Original Medicare so that he can continue to see that doctor.
Other reasons might include frustration with having to get referrals to see a specialist. Medicare Advantage plans may require prior authorizations for things like surgeries or diagnostic tests. All of these things are common in Medicare Advantage plans but people can find it burdensome. Sometimes beneficiaries decide the savings they are receiving on their premium just isn’t worth the freedom of access that they have given up.
Whatever the reason, Medicare beneficiaries should take careful steps when considering a change from Medicare Advantage back to Original Medicare. Here are some basic “rules” for doing so:
Switching from Medicare Advantage Requires a Valid Election Period
Medicare Advantage plan membership is generally for an entire calendar year. Leaving the plan requires that you have an approved election period to do so.
The easiest election period to use is the Annual Election Period which runs from October 15th – December 7th. During this period, members of Advantage plans can move from their current plan to a different Advantage plan. They can also choose to return to Original Medicare. Enrolling in a new Part D drug plan will disenroll the member from their current plan and return them back to traditional Medicare.
Check out our post on preparing for the Medicare Annual election period each year.
And as of last year, beneficiaries can also use the Open Enrollment Period (OEP) that allows beneficiaries who are enrolled in a Medicare Advantage Plan to make a one-time change.
The Medicare OEP is for beneficiaries to:
- Switch from one Medicare Advantage plan to another Medicare Advantage plan OR
- Disenroll from a Medicare Advantage plan and return to Original Medicare, with or without a Part D drug plan
Outside of these two election periods, there are various special election periods which can qualify a person to make a change. Examples would include:
- A move out of the current plan’s service area or qualification.
- If someone newly qualifies for the Low Income Subsidy for prescription drugs.
Speak to your agent about whether you have a valid election period to make a mid-year change. There are literally pages of approved special election periods, and your agent can help you determine if you qualify for one.
Approval for Medigap is Not Guaranteed
Leaving a Medicare Advantage plan simply moves you back to Original Medicare. Having only Original Medicare puts you at considerable risk for catastrophic medical spending if you have a serious illness. Medicare has no cap on your out of pocket expenses. For example, someone with cancer will pay 20% for their chemotherapy with no cap to that spending.
For this reason, most people returning to Medicare want to also apply for a Medigap plan to supplement their Medicare. However, unless you are being involuntarily disenrolled from your Medicare Advantage plan, you don’t automatically qualify for Medigap.
A Medigap plan application includes a section of health questions. You must be able to answer NO to all of these questions in order to be approved for coverage in most states. A medical underwriter will review your application. A serious illness such as congestive heart failure or COPD will disqualify you from almost every insurance carrier offering Medicare supplements.
So before you leave your current coverage, make sure you are certain you can be approved for Medigap coverage. You don’t want to be left with no supplemental coverage.
Plan Your Effective Dates
Leaving your Medicare Advantage plan usually means you will need new coverage for the first of the month following that disenrollment. However, if you use the Annual Election Period to change, then your effective date for any new insurance will need to be January 1st.
Leaving Medicare Advantage usually means you’ll lose the built-in Part D drug plan. You’ll want to have done all your research about which standalone drug plan will be most suitable for you when you return to Original Medicare. Drug formularies are different on each plan. It also takes time to set up things like mail order delivery on a new plan. Be sure to plan when to get a final fill of your medications on your current plan before you roll off that coverage.
Working with an insurance broker who specializes in Medicare Advantage plans can greatly simplify this process. Our agency handles scores of Medicare Advantage plan switches every year. Our team knows all the proper election periods to use. More importantly we can help you plan each step so that you don’t overlook anything important.
Give us a shout if you’d like our assistance. It’s free!