Uneducated Medicare Decisions Can Lead to Coverage Problems for Preexisting Conditions

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As Medicare Advantage plans multiply and some Medicare Supplement plans go away, seniors transitioning into coverage may fail to understand the best suited options for their preexisting conditions. Ensurem, a digital insurance broker, is on a mission to solve this problem—Supplying a real-time platform for purchasing privately managed Medicare insurance solutions that aims to mitigate health risks due to coverage and expense gaps.

We want to make it clear what is being offered to each new Medicare enrollee, the possible advantages and drawbacks of every option, and the best choice to fit each enrollee’s needs—including those of people suffering from chronic conditions

There are about 77 million baby boomers in the United States, of whom 10,000 per day become eligible for Medicare.(1) It is estimated that nearly half of these new Medicare enrollees have a preexisting medical condition that could lead to coverage issues with supplemental Medicare insurance.(2) Medicare supplement plans, notes says Dave Rich, CEO of online multi-carrier insurance broker Ensurem, can delay coverage for up to six months for health conditions that were treated or diagnosed within six months of application. “As many chronic conditions require regular treatment,” says Rich, “seniors with such conditions who are initially enrolling in Medicare should make certain that any plan they purchase will provide for their actual medical needs.”

Research also suggests that baby boomers in their 50s and 60s are in poorer health, with more chronic diseases and disabilities, than earlier generations at the same age. One study shows older adults in 2004-2010 having a higher prevalence of six out of eight chronic conditions—including a 37% higher prevalence of diabetes—than their peers in 1992-1998.(5) These findings have helped drive public discussions of overall healthcare costs in the U.S., with estimates ranging from $3.2 trillion per year over the next decade for one proposed solution(6) to $3.6 trillion per year for maintaining the status quo, to $4.4 trillion or more.(7)

Navigating Medicare Gaps for Seniors

Original Medicare leaves treatment and expense gaps in coverage for the consumer, so many seniors must opt in for additional insurance. While in some areas there are twenty or more different plans available, the options, notes Rich, fall into two categories. Medigap, also known as Medicare Supplement Insurance, offers coverage for out-of-pocket expenses not covered by Medicare A and B. These plans serve essentially as an extension of basic Medicare, covering additional expenses while maintaining the covered person’s right to treatment by any healthcare provider who accepts Medicare. Medicare Advantage plans, on the other hand, limits policyholders to using the insurer’s managed-care network; some such plans do not cover out-of-network providers at all. (3)

For a Medicare Supplement policy especially, notes Rich, carriers may stipulate a delay in coverage for preexisting conditions. New enrollees should also be aware that for a brief period—the six months after they first sign up for Medicare Part B—Medigap plans cannot reject an applicant, or charge a higher premium, because the applicant has a preexisting condition. Once that period is over, insurers (except in Connecticut, Massachusetts, Maine, and New York) can reject applicants with a preexisting condition or charge them a higher premium. (4)For Medicare Advantage, carriers may not deny an application due to any preexisting condition other than end-stage renal disease.

While these discussions are important, says Rich, what is needed on the individual level is clarity—not for the future, but for now. Ensurem’s goal is first to understand what is happening in the Medicare space at any given time, and secondly to translate that to the customers who come on their site. “We want to make it clear what is being offered to each new Medicare enrollee, the possible advantages and drawbacks of every option, and the best choice to fit each enrollee’s needs—including those of people suffering from chronic conditions.”

About Ensurem:
Ensurem, headquartered in Clearwater, FL, is a leading technology and product distribution company serving carriers and consumers within the massive U.S. senior market. The company provides end-to-end solutions for carriers, including product development, digital marketing, and consumer-centric front ends and back end. For more information, please visit Ensurem.com.

1.    Frankel, Matthew, “9 Baby-Boomer Statistics That Will Blow You Away,” Motley Fool, July 29, 2017, fool.com/retirement/2017/07/29/9-baby-boomer-statistics-that-will-blow-you-away.aspx.
2.    “Nearly 54 Million People Have Pre-Existing Conditions That Would Make Them Uninsurable in the Individual Market without the ACA,” Kaiser Family Foundation, October 4, 2019, kff.org/health-reform/press-release/nearly-54-million-americans-have-pre-existing-conditions-that-would-make-them-uninsurable-in-the-individual-market-without-the-aca/
3.    White, Jacquelyn, “Medicap vs. Medicare Advantage: What’s the Difference?”, The Street, January 24, 2020, thestreet.com/personal-finance/insurance/health-insurance/medigap-vs-medicare-advantage
4.    Miller, Mark, “Medicare’s Private Option Is Gaining Popularity, and Critics,” New York Times, February 21, 2020, nytimes.com/2020/02/21/business/medicare-advantage-retirement.html
5.    Scommegna, Paola, “Are Baby Boomers Healthy Enough to Keep Working?”, Population Reference Bureau, April 23, 2018, prb.org/are-baby-boomers-healthy-enough-to-keep-working/#.
6.    Blumberg, Linda, et al., “From Incremental to Comprehensive Health Insurance Reform: How Various Reform Options Compare on Coverage and Costs,” Urban Institute, October 2019.
7.    “National Health Expenditure Accounts—Historical,” Centers for Medicare and Medicaid Services, 2019, cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData

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