My Medicare Advantage Plan Will Be Discontinued. What Can I Do?

Medicare-plan

Did you recently receive a letter from your insurance company in the mail, announcing that the advantage plan you are currently enrolled in will be discontinued in 2014?

It happens every year to thousands of beneficiaries who are enrolled in a Medicare advantage plan. Their insurance carrier drops the plan, leaving them overwhelmed with the many choices of looking for alternative coverage.

You may blame the government, Obamacare, Congress or the health care reform, the reasons why insurers terminate advantage plans or leave a local area are manifold, but are mostly due to financial implications. While the government forces insurance companies offering Medicare advantage plans to comply with federal regulations, insurers are not required by law to keep servicing a geographic area, or renew their contracts with medical providers or facilities. Although CMS, the Centers for Medicare and Medicaid Services, must approve, private insurance companies can, at their own discretion, at the end of each year freely decide whether to drop a plan completely, reduce its benefits, or change premiums, deductibles or copays.

If you are affected by an upcoming plan change for 2015, you must be notified in written by your insurance provider in early October 2014, as upcoming changes will go in effect in January.

What happens if I do nothing?

If you plan is discontinued or the carrier withdraws from your local area and you don’t act, you will automatically be switched back to traditional Medicare, with out-of-pocket expenses for expenses that are not covered by Part A or B of original Medicare. More importantly, you will loose any prescription drug coverage your advantage plan may have included!

What are my options to get into another Medicare plan?

When your advantage plan is terminated without your fault, you have the right to switch to a different plan, regardless of your health and age. You have the following options if you don’t plan on relying on traditional Medicare alone:

  1. Replacing your discontinued advantage plan with a different Medicare advantage plan that is available in your area, either from the same or another provider
  2. Switching back to original Medicare and adding supplemental insurance by enrolling in a Medigap plan, and optionally (but recommended) adding prescription drug coverage with a Part D Medicare plan

Make sure you assess your current medical needs carefully as they may have changed since you last enrolled in a health plan. When you compare your new options, don’t just look at the benefits and premiums. Make sure:

  • To consider the total costs (including premiums, copayments, deductibles, and annual out-of-pocket limits) of a plan
  • Your physicians and other health care providers are included in the plan’s list of accepted providers
  • Your medication needs are covered

Be aware that there may be big differences in benefits, providers, exclusions and cost sharing structures between plans, even if they are offered by the same provider!

A good starting point to see which plans are available in your area is the Medicare Plan finder, provided by Medicare.gov on their website at https://www.medicare.gov/find-a-plan/questions/home.aspx.

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By: Joseph Rosario