Medicare Supplemental Insurance
Medicare does not cover all necessary health care expenses. Most people need to find a way to pay for those costs not covered by Medicare. These policies are different from other major medical indemnity, specific-disease and long-term care insurance policies. Supplement policies are tied directly to the gaps in Medicare and are often referred to as Medigap policies.
The sale of Medicare supplemental insurance is regulated in South Dakota by the Medicare Supplement insurance law. In addition, the Division of Insurance has set standards and requirements for the sale of Medicare Supplement policies to protect the consumer.
Before purchasing Medigap insurance, you should review any insurance policies to determine what your current coverage already provides. You should also determine if you qualify for Medicaid assistance.
Once you determine what your insurance policies and Medicare will cover, you can determine whether or not you need a Medigap policy.
South Dakota has ten standard Medicare Supplement policies. Prices will vary from one insurance policy to another. You should shop around and look at all your options before purchasing a policy. In addition, avoid purchasing a Medigap policy that offers duplicate coverage or that doesn't meet your needs. It is usually a good idea to purchase your policy within six months of the date you were enrolled in Medicare Part B and are age 65 or older.
State and federal laws guarantee your right to Medigap coverage during this six month open enrollment period. This means you have the right to buy the Medigap policy of your choice regardless of any health problems you might have. The company cannot deny or place any conditions on your policy. It can, however, impose the same standard pre-existing condition that it applies to Medigap policies sold outside the open enrollment period.
When you do find a policy, complete the application carefully. If you are not applying during open enrollment, most applications will require you to provide a detailed medical history. Leaving out any preexisting condition might cause problems, such as refusal of coverage or a cancellation of your policy.
Before you sign the application, your agent is required to give you an outline of the coverage. Read it carefully and if you don't understand something, ask your agent to explain it.
A good insurance agent will guide you through the process of purchasing a Medigap policy. Your insurance agent is also required to provide you with a shopper's guide. The Guide to Health Insurance for People with Medicare is a valuable resource and will help you make your health insurance decisions. It is available through your insurance agent or the State Division of Insurance.
State laws and regulations do provide some protection for Medigap consumers.
The law requires that:
- Your insurer may not sell you a second Medigap policy.
- Benefits for preexisting condition can be refused for no longer than six months.
- Your policy can only be canceled for the failure to pay premiums or for material misrepresentation by you.
- You have the right to return the policy within 30 days for a full refund.
- Your agent or company must provide you with an outline of coverage which includes premium information, legal disclosures, and charts of each plan offered.
Purchasing Medicare Supplemental Insurance is often a necessity. Knowing what to look for will help you make wise choices.
You can get more information about Medigap coverage by contacting the State Division of Insurance at 605-773-3563.
The Division also takes complaints about agents, carriers, and insurance policies.
Insurance Counseling
The senior Health Information and Insurance Education program (SHINE) is also a good resource for questions on Medicare Supplement Insurance. It is free to South Dakotans and offers counseling services.
SHINE has a book available, South Dakota Medicare Supplement Insurance Rates, it outlines the ten standard policies, and compares rates of each company and policy. You can get a copy of this book by calling SHINE at 1-800-822-8804.
Medigap Alternatives
As an alternative to purchasing a Medicare Supplement insurance policy, you might want to consider other available options. For example, some employers offer health insurance to help retired employees supplement Medicare. Another option might be to become a member of a health maintenance organizations (HMO). HMO's provide coverage for the portion of medical services not covered by Medicare. Take note, that this option is only available to people residing in certain counties in South Dakota.
Other insurance policies might also be available. Indemnity, specific disease, and long-term policies are available to meet certain needs. However, the payment under these types of policies generally do not cover all Medicare gaps. It is usually preferable to purchase a Medicare Supplement insurance policy.