Medicare Advantage Enrollment Risks: Medigap Underwriting and Switching Limits

Medicare Advantage (MA) plans, also known as Medicare Part C, are government-approved health plans offered by private insurers as an alternative to original Medicare. These managed-care plans, often HMOs or PPOs, typically require members to use a network of providers. MA plans cover Medicare Part A and Part B services and usually include additional benefits such as dental, vision, hearing, gym memberships, and prescription drug coverage. They tend to be more affordable initially than original Medicare combined with a separate prescription drug plan and Medigap supplemental insurance, making them appealing to healthier individuals.

However, MA plans have certain limitations including annual changes in benefits and provider networks, potentially higher out-of-pocket costs for out-of-network care, and stringent pre-authorization requirements which may delay or limit access to services. Conversely, original Medicare provides stable coverage with broader provider access but includes coverage gaps resulting in deductibles and coinsurance expenses. To fill these gaps, many beneficiaries acquire Medigap policies.

Crucially, timing affects Medigap eligibility and pricing. Enrollees who choose original Medicare at initial eligibility are guaranteed access to Medigap plans without medical underwriting during the six-month Medigap Open Enrollment Period. Those who enroll first in MA plans cannot purchase Medigap while in the plan and risk facing medical underwriting or denial if switching later to original Medicare and seeking a Medigap policy. This practice is often referred to as the "Medicare Advantage trap."

Notably, four states—Connecticut, Massachusetts, Maine, and New York—have regulations preventing insurers from denying Medigap coverage based on pre-existing conditions. Medicare beneficiaries considering their coverage options should carefully evaluate the trade-offs between MA plans and original Medicare plus Medigap, especially regarding future flexibility and potential underwriting risks.

For more guidance on Medigap and Medicare options, official resources like Medicare.gov provide comprehensive information. Understanding these dynamics is essential for beneficiaries to manage their healthcare coverage and costs effectively after initial Medicare enrollment.