Key Points:
Medicare changes are leading to thousands of people being disenrolled from their Medicare Advantage Plans
These people may not be automatically put into a new Medicare Advantage plan
Those disenrolled may be able to go to a Medicare Supplement with no health questions
Are you about to be among the thousands of people who will be automatically disenrolled from their Medicare Advantage plan in 2025? If so, be aware that you may not be automatically enrolled into a new one! Shake-ups in the Medicare industry may leave you without the coverage you prefer or need next year. Learn why this mass Medicare Advantage disenrollment is happening and how you can protect yourself.
Why Disenrollments Are Happening
In 2022, congress passed the Inflation Reduction Act. This sweeping legislation covered many pieces of our federal budget, and provided major changes to Medicare Part D. We’ve talked about these changes in detail in other articles. Here are links to those articles:
These Part D changes are forcing Medicare Advantage plans to change in a big way; but they can only change so much each year. The limits are designed to ensure that enrollees are not blindsided by massive benefit adjustments. This is a great consumer protection, but these changes are putting many insurance carriers in a tough situation.
Because of the new Part D rules, many insurance carriers are having to alter their Medicare Advantage plans beyond the legal threshold for change. When they want to change a plan beyond the legal threshold, they must outright terminate the plan. This means that everyone in this plan will be disenrolled on January 1st of the following year. At that point, those disenrolled people will have only Original Medicare coverage. If your plan is terminated, you will still have coverage until December 31, 2024.
You also are not always moved into a new plan automatically. This is called cross-walking, where an insurance company puts you into a new plan that is like the one you are currently enrolled in, but not exactly the same thing. Preventing this is another great consumer protection. It stops insurance companies from enrolling people into plans they haven’t fully researched. But it also could leave people who don’t pay close attention to their mail, without Medicare Advantage coverage in 2025.
What To Do
If your plan is cancelled, you should receive a notice in late September. Your insurance carrier will notify you that they are removing your plan from their roster and offer you some options. You will have the entire Medicare Annual Enrollment period (October 15th to December 7th) to sign up for a new Medicare Advantage plan. There also is a Special Enrollment Period that would kick in due to your loss of coverage and would allow you to sign up from December 8th all the way through February of the following year!
Just know that enrollments are on a month-to-month basis. Meaning if you sign up in January for a new Medicare Advantage plan, your coverage won’t start until February.
Because of this month-to-month enrollment structure, we highly recommend enrolling in a new Medicare Advantage plan that fits your needs during the usual Medicare Annual Enrollment period. This will give you plenty of time to assess your options and give your insurance carrier ample time to process your application.
Guaranteed Issue Medicare Supplements
If you are in a Medicare Advantage plan that is being cancelled, you are given another option: getting Guaranteed Issue rights into Medicare Supplement.
Many people want to switch from Medicare Advantage to Original Medicare with a Medicare Supplement. But acceptance into a Medicare Supplement is not guaranteed. In most cases, an insurance carrier will ask you health questions and look through your medical records to determine if you are healthy enough. This is called underwriting.
This underwriting process does not occur if you have Guaranteed Issue rights. Guaranteed issue rights allow you to waive the health questions and get into a Medicare Supplement no matter what. If you are in a Medicare Advantage plan which is being cancelled, you have access to a Guaranteed Issue Medicare Supplement. You can start Original Medicare with a Medicare Supplement on January 1st of the following year.
What To Do Next
2025 is slated to be one of the most complex years in Medicare history. Massive Medicare Part D changes and large amounts of Medicare Advantage disenrollments will leave many feeling unsure of what’s best. Now more than ever, you should have an expert who cares, in your corner.
Talk to the brokers at NJ Life and Health to protect yourself from Medicare Advantage disenrollments and more. We stay up to date on the constantly changing Medicare landscape and always have our clients' best interests at heart. Contact us at 848-226-6897 or visit our website at www.njlifeandhealth.com to request your free no cost consultation.
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