Because there are so many regulations for Medicare sales, agents need to constantly be learning. That is why we will discuss Medigap Guaranteed Issue Rights in this post. This is a subject that is crucial to understand but often misunderstood.
Medigap Guaranteed Issue Rights
Guaranteed Issue (GI) Rights are protections under federal law that provide beneficiaries the right to purchase certain Medigap (Medicare Supplement) policies without having to go through medical underwriting. That means insurance companies can’t:
- Deny the beneficiary enrollment in a policy
- Charge enrollees more based on health
- Impose waiting periods for pre-existing conditions (in most cases)
These rights kick in during specific situations, often tied to changes in your health coverage or life circumstances.
When Guaranteed Issue Rights Apply
Here are some common scenarios that trigger GI rights:
Turning 65
Anyone who turns 65 has a 6 month period where they can enroll in a Medigap plan without having to go through underwriting.
Loss of Employer or Union Coverage
Individuals that have health coverage through an employer or union (including COBRA) that ends have 63 days from the end of that coverage to buy a Medigap policy using GI rights.
Medicare Advantage Plan Leaves a service Area
If a Medicare Advantage (MA) plan no longer provides service the enrollee’s area, is terminated, or they move out of the plan’s service area, they can return to Original Medicare and buy a Medigap policy under GI protections.
Beneficiary Tries a Medicare Advantage Plan for the First Time
Those who joined an MA plan when they were first eligible for Medicare at 65 and switch back to Original Medicare within the first 12 months can buy any Medigap policy offered in their state.
Medigap Insurance Company Goes Bankrupt or Misleads You
If the Medigap insurer goes out of business or the beneficiary is misled into buying a policy, they have GI rights to purchase another policy.
Trial Rights
In some cases, beneficiaries have “trial rights” that allow them to try out an MA plan and return to a Medigap plan under GI protections. This typically applies if they dropped a Medigap policy for an MA plan and want to switch back within 12 months.
Rules and Timelines
- Typically individuals have a 63-day window from the date previous coverage ends to use their GI rights.
- The plans that are guaranteed issue depend on eligibility and location. The standard Medigap plans are Plans A, B, C, F, K, or L.
- The federal government mandates guaranteed issue rights, although some states offer broader protections. It is important to check the rules for each state.
Watch a YouTube video on Medicare Supplement Underwriting GI & non-GI states
Why Guaranteed Issue Rights Matter
Without GI rights, applying for Medigap outside the initial enrollment period often means going through medical underwriting. Those who have pre-existing conditions could be denied coverage or charged more.
GI rights are a safeguard. They ensure that when life throws a curveball like; losing coverage, moving, or simply changing your mind, beneficiaries can access supplemental coverage without penalty.
Birthday Rule
There are 6 states that allow beneficiaries to change Medigap plans without underwriting during a specific period before/after their birthday each year on a GI basis. The states that have this rule are: CA, ID, IL,KY, LA, MD, NV, OK & OR. Each of these states has it’s own specific rules for this.
Important:
Some states allow beneficiaries to change Medigap plans any time or at specific times without undergoing medical underwriting. These states are: CT, NY, MA & ME.
In CT & NY enrollees change Medigap plans anytime of the year without underwriting. Massachusetts offers an annual open enrollment where beneficiaries do not have to go through underwriting. In Maine there is an open enrollment in June where Medicare Supplement enrollees can switch to a similar or lower benefit plan without underwriting.
Anyone applying under GI rights; insurance companies may request documentation (like letters from the former insurer). Keeping all notices and paperwork handy makes the application process smoother.
Medigap Guaranteed Issue Rights are an important part of the Medicare landscape, especially for those navigating transitions. Understanding when and how they apply allows you to help clients make informed choices and avoid gaps in healthcare coverage.