If you’ve had an insurance plan through your employer for most of your life, you’re probably accustomed to annual open enrollment, where you can easily switch insurance plans after comparing coverage and premiums.
Once you turn 65 and opt into Medicare coverage, open enrollment opportunities for supplemental coverage are few and far between. In the case of Medigap, a supplemental insurance plan for Medicare, that opportunity only occurs once per lifetime without requiring medical underwriting.
The exception to this falls under the Medigap "birthday rule." Read on to learn more about what the birthday rule is and how it works.
Key Takeaways:
- Medigap is supplemental insurance to original Medicare that is sold by private companies to cover additional out-of-pocket costs.
- Without the birthday rule or guaranteed issue rights, switching Medigap plans usually requires medical underwriting.
- The specifics of the Medigap birthday rule, including the enrollment window and eligibility criteria, vary by state.
What Is Medigap?
Medigap is supplemental insurance to original Medicare that helps cover some of the out-of-pocket costs associated with Medicare coverage. Medigap plans are sold by private insurance companies, not by the federal government, though they are overseen by the Centers for Medicare & Medicaid Services.
How the supplement works with the parts of Medicare:
- Part A (hospital insurance): Medigap helps supplement Medicare Part A. To hold a Medigap policy, you must also have Medicare Part A coverage.
- Part B (medical insurance): Medigap helps supplement Medicare Part B. To hold a Medigap policy, you must also have Medicare Part B coverage. Your eligibility for a Medigap plan begins after you enroll in Medicare Part B.
- Part C (Medicare Advantage): Medicare Advantage plans are another type of supplemental insurance. You have to choose between either Medigap or Medicare Advantage plans. Think of them like discount offers you can’t combine.
- Part D (drug coverage): Part D is separate from Medigap coverage. Medigap doesn’t cover Part D, and you can choose to opt in or out of Part D with no effect on your Medigap plan.
According to CMS, other supplemental plans that aren’t Medigap include:
Medigap Coverage Plans
There are a variety of Medigap plans to choose from that offer standardized coverage. The only differences between the plans is the cost and levels of coverage, as they are sold by private insurance companies who select their pricing.
Benefits vary under each Medigap plan, such as:
- Coinsurance and copayment coverage
- Deductibles
- Skilled nursing care benefits
- Blood transfusion coverage
- Foreign travel benefits
- Out-of-pocket limits
For a complete chart of these benefit comparisons, visit Medicare.gov.
How Does Medigap Enrollment Work?
Medigap policies have an initial open enrollment period similar to original Medicare. Traditionally, Medigap plan open enrollment only occurs once per lifetime, under the following conditions:
- You are at least 65 years old
- You are enrolled in Medicare Part B
- You have a Medicare number
- No more than six months have elapsed since your Medicare Part B coverage began
If you qualify for Medicare for a certain disability, like end-stage renal disease, but you’re under 65, you’ll need to check with your state of residence to see if you’re eligible for Medigap coverage.
What is a guaranteed issue right?
A guaranteed issue right, also known as Medigap protections, means an insurance company cannot deny you a Medigap policy or charge you higher premiums for a preexisting condition, such as diabetes or heart failure. It's enacted when you first sign up for Medigap, meaning you are in your open enrollment period, or in certain situations where your health coverage changes outside of open enrollment.
With guaranteed issue rights, there are no medical questions, and the member selects their desired plan and is enrolled, says Dominic Morrone, the principal president of the ABC Unit of World Insurance Associates LLC in Blackwood, New Jersey. In contrast, if you want to switch Medigap plans outside of open enrollment, guaranteed issue rights typically do not apply and insurance companies can deny your coverage, limit your plan options or charge more for your plan.
What Is the Medigap Birthday Rule?
The Medigap birthday rule establishes additional open enrollment periods so Medigap open enrollment is no longer a once-in-a-lifetime event. To qualify for the birthday rule, you need to already carry a Medigap plan. The birthday rule is only to switch Medigap plans, but doesn’t apply if you never carried a Medigap plan to begin with.
Jessica Topolski, a Medicare specialist at AZ Health Insurance Brokers in Phoenix, gives the following example:
Say you're currently enrolled in Medigap Plan G, but you want to change to a less expensive plan, like Plan N. When your birthday comes around, depending on which state you live in, you'll have an allotted time to switch your plan.
Essentially, the birthday rule gives you guaranteed issue rights at this time. No health questions will be asked when enrollees are applying for the new plan.
"It’s similar to the open enrollment period they had when they first were eligible for Medicare," Topolski says.
What states have the Medigap birthday rule?
As of June 2024, nine states have enacted some type of Medigap birthday rule:
- California
- Idaho
- Illinois
- Kentucky
- Louisiana
- Maryland
- Nevada
- Oklahoma
- Oregon
The Medigap birthday rule or open enrollment periods are subject to change or be initiated through state-specific legislative action like state Senate bills. There are currently no federal regulations for the birthday rule.
How does the Medigap birthday rule differ by state?
Since the Medigap birthday rule is state-specific, there are variations between each state regarding:
- Which states offer the birthday rule at all
- How long the window is for enrollment changes. For example, the window in Idaho is 63 days after your birthday, while the window in Maryland is 30 days. In some states, like Oregon, the window starts before your birthday.
- Whether the change in plan needs to be with the same insurance carrier or if you can switch carriers
- Whether the change must be to a policy with equal or lesser coverage
- Whether the new plan incurs more or less cost-sharing responsibilities, like coinsurance
- How old you can be. For example, Illinois only allows the birthday rule up to and including age 75.
Some states offer year-round open enrollment, like Connecticut, New York, Vermont and Washington state. Each of these states has specific requirements for eligibility to make a plan switch.
To learn more about Medigap birthday rule regulations in your state, contact your state’s Department of Insurance.
What if I didn't initially get Medigap or I have Medicare Advantage (Part C)?
There are different state-specific guidelines on what changes you can make, Morrone explains.
“Also, currently the birthday rule only applies to members who are already insured with a Medigap plan. It generally does not apply when switching from Medicare Advantage to Medigap,” Morrone clarifies.
According to CMS, you may qualify for Medigap if you initially had Medicare Advantage under the following conditions:
- Your Medicare Advantage plan is leaving Medicare
- Your Medicare Advantage plan misled you or did not follow federal guidelines with advertising or coverage
- Your Medicare Advantage plan does not cover your area, or you are moving out of your coverage area
What Is Medical Underwriting?
Without the Medigap birthday rule or a guaranteed issue right, if you want to opt in to or switch Medigap plans, you would need to undergo a process called medical underwriting.
Medical underwriting is a risk assessment for insurance carriers to determine if they want to provide you with a Medigap plan. This may entail:
- Completing a comprehensive health assessment
- Answering questions about your health
- Providing medical records at the request of the underwriter
Underwriting requirements for Medigap plans may also differ by state. Insurance companies can deny you a policy or charge more for a policy as a result of the medical underwriting process.
The Bottom Line
The Medigap birthday rule provides additional open enrollment periods throughout your lifetime to switch Medigap plans. Medigap birthday rules are state-specific, so check with your state’s Medicaid office for assistance or more information.
“I believe the birthday rule is a step in the right direction,” Morrone says, referring to giving consumers more freedom with their health care coverage options. He believes other states will probably be adding the birthday rule to provide consumers with more health care choices.