Navigating Medicare Advantage: Understanding the Implications for Pre-Existing Conditions
February 21, 2024
Choosing the right Medicare plan is crucial and can impact your health insurance coverage and your finances over the long run. Let’s look at specifically Medicare Advantage plans. Many people opt for Medicare Advantage plans, often attracted by the low (or no) monthly premium and extra benefits that may be provided in the specific plan. However, it’s essential to delve deeper into the potential consequences of enrolling in these plans.
The Appeal of Medicare Advantage Plans
Medicare Advantage plans, or Part C, offer a bundled alternative to Original Medicare. The plans must provide what Original Medicare (Parts A and B) provide but may deliver the coverage differently. These plans will often include additional benefits such as vision, dental, and prescription drug coverage, making them attractive for those seeking what they might feel is a “simpler” approach.
The Catch – Pre-Existing Conditions and Medigap Policies
While Medicare Advantage plans can provide extensive coverage, beneficiaries may face challenges if their health deteriorates and they would like to change their coverage should it prove inadequate. In that situation, if a person decides that they would prefer a Medicare supplement policy, they would typically be required to go through medical underwriting. It will depend on your state, but most states require people who want to purchase a Medicare supplement to undergo medical underwriting*. That may or may not be possible at the time of your application.
*You can avoid underwriting if you sign up for the Medigap plan during your six-month Medigap Open Enrollment Period. This period begins on the first day of the month you’re both 65 years old and enrolled in Medicare Part B. For example, if you turn 65 on July 14, and are enrolled in Medicare Part B, you have until December 31 to enroll in a Medigap plan. If you apply for a Medigap plan during your Medigap Open Enrollment Period, your acceptance into the plan is guaranteed, and the plan can’t charge more if you have a health condition. You must be enrolled in Original Medicare, Part A and Part B as a prerequisite.
Pre-Existing Conditions and Limited Switching Options
When a person approaches age 65 as a healthy person, they will often choose Medicare Advantage plans assuming that they will change plans during the annual “open enrollment” window that Medicare provides. However, as the years go by and their health may change, they will learn that the “open” enrollment period is not quite so “open.” Unlike provisions in the Affordable Care Act that provide for the ability to get coverage regardless of any pre-existing conditions, Medicare does not work the same way.
Seeking Professional Guidance
Given the complexities of Medicare plans and the potential impact of pre-existing conditions, consulting with a knowledgeable financial advisor is essential. A qualified advisor can help navigate the intricacies of Medicare choices, ensuring your healthcare coverage aligns with your current and future health needs.
Planning for a Healthy Future
In conclusion, choosing between Medicare Advantage and Medigap requires a thoughtful analysis of current and potential future health scenarios. While Medicare Advantage plans offer bundled and potentially more “simplistic” coverage, the limitations regarding pre-existing conditions highlight the importance of careful consideration. Seeking professional guidance can empower individuals to make informed decisions that safeguard their health and financial well-being in the long run.
Gary S. Williams is Founder and CEO of Williams Asset Management located at 8850 Columbia 100 Parkway, Suite 204, Columbia, MD 21045. He offers advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, a Registered Investment Adviser. Gary can be reached at (410) 740-0220 or at Gary@WilliamsAsset.com
This material has been provided for general informational purposes only and does not constitute either investment or tax advice. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a financial advisor or tax preparer.
