3 Ways to Avoid Being Rejected or Overcharged for a Medigap Policy

A birthday rule that allows you to change plans during a specified time around your birthday is law in several states.

In Oregon, you have 30 days after your birthday each year to switch to another Medigap plan with equal or lesser benefits. In California, you have 60 days after your birthday every year to do so.

As of Jan. 1, 2024, Kentucky residents will have up to 60 days after their birthday to switch to the same Medigap plan with a different insurer regardless of preexisting conditions. As of July 1, 2023, Marylanders can switch to another Medigap policy with equal or lesser benefits within 30 days after their birthday each year.

Illinois residents ages 65 to 75 can switch to another policy with the same insurer with equal or lesser benefits for up to 45 days after their birthday, a change that took effect in 2022.

In Missouri, you have up to 30 days before and 30 days after the anniversary of the date you purchased your policy to switch to the same letter plan with a different insurer.

In most states, insurance companies aren’t required by law to issue Medigap policies to people with preexisting conditions. However, some insurers, such as Blue Cross/Blue Shield in Illinois, offer some guaranteed issue plans.

Tricia Neuman, executive director of the program on Medicare policy at KFF (formerly the Kaiser Family Foundation), recently saw differences in state rules firsthand when helping two friends shop for Medigap policies. 

One friend, in Pennsylvania, already had a Medigap policy and wanted to switch to another plan with fewer benefits to save money. If she didn’t have any health problems, the new plan each month would cost $100 less than her current plan. But because she lives in a state that allows insurers to charge more for preexisting conditions and she uses an inhaler for a lung condition, the insurer wanted to charge $100 more than her current plan. 

The experience was very different for Neuman’s friend in New York.

“That same company allowed a 90-year-old I know to switch plans for a lower premium,” Neuman says. She didn’t have to answer any questions about her health.

To learn about your state’s rules, contact your State Health Insurance Assistance Program. Most state insurance departments have Medigap buyers’ guides that explain the rules and may even list premiums for each insurer.

Keep in mind that many of these rules apply only to people who are 65 and older. If you’re younger than 65 and have Medicare because of a disability, you may have a more difficult time qualifying for coverage. The pre-65 Medigap rules vary significantly by state.

3. Shop for an insurer that will cover your medical condition

When you apply for a Medigap policy and don’t have a guaranteed issue right, you’ll usually have to answer questions about your health. Steve Jones, president of Cigna supplemental benefits, says insurers typically don’t ask to see your medical records, but they usually ask about your prescription medications.

“Insurers may ask if a doctor treated you, gave you medical advice or prescribed any medications for certain conditions in the last two years,” says CEO Joanne Giardini-Russell of Giardini Medicare, an independent insurance agency in Howell, Michigan.

Having one of the following conditions in the past two years could increase the rate you’ll pay for a Medigap policy, depending on the insurer:

• Artery or vein blockage

• Atrial fibrillation

• Cancer

• Cardiomyopathy

• Chronic kidney disease

• Chronic obstructive pulmonary disease (COPD)

• Congestive heart failure

• Multiple sclerosis

• Rheumatoid arthritis

Insurers usually decline people who have COPD, lupus or Parkinson’s disease or were recently diagnosed with cancer, Giardini-Russell says. Other conditions, such as high blood pressure, diabetes and high cholesterol, may be acceptable. But you may have to pay a higher rate.

You also may be asked if a medical professional prescribed any of the following procedures: joint replacement, organ transplant, cancer surgery, back or spine surgery, or heart or vascular surgery. Some insurers may deny coverage if you’ve been hospitalized in the past 90 days or if you live in a nursing facility.

However, timing and the nature of your medical condition are important. If you were diagnosed with cancer or had surgery a while ago, you may still be able to buy a policy.

“If a person had knee replacement eight months ago and is done with physical therapy, they will generally be accepted as long as they don’t have any other health problems,” Giardini-Russell says.

Some insurers are more lenient than others.

“Underwriting varies considerably from one company to another,” Bonnie Burns, a consultant with California Health Advocates, says about pricing and decisions on whether to issue a policy.

Depending on a person’s health, Cigna may offer a lower, also called a preferred, rate or a slightly higher standard rate. For major health issues, an insurer may offer different versions of a policy at a higher rate or it may reject the applicant.

If you’re trying to get a Medigap policy when you don’t have a guaranteed issue right and you have preexisting health conditions, you might consider getting help from an independent agent who works with several companies and knows the underwriting criteria.

“It can avoid a lot of frustrations,” Giardini-Russell says. “I recently told a woman who has lupus that if she didn’t get Medigap right out of the gate, there was a good chance she might not be able to get it in the future.”

For a list of insurers that sell Medigap policies in your area, visit Medicare’s Medigap plan finder.

This story, published Dec. 6, 2021, has been updated with new information.