Does the 'birthday Rule' help Medicare Supplement Plan Members?

[Spud]

Hi, I am seeing more insurance companies offer Medigap plans close their book of business when their premiums no longer remain competitive and then open a new book under a new subsidiary name and start the process over.

This practice may look good from a company's financial point of view, but the plan member that cant get thru underwriting (to switch plans/companies) may not share that same enthusiasm.

Some states have implemented the 'birthday rule' to give Medigap plan members the right to change plans without going thru underwriting either in the 30-day window before/after their birth month.

Are you aware of a study that is in the public domain that has researched the financial impact (lower monthly premiums in the long run) because of the birthday rule?

If you sell medigap plans and some of your customers have been caught up in the 'closed book of business situation', do you make them aware their vendor closed their book of business and point out their exposure to higher rates AND then their options to change plans to either another company's Medigap plan(s) or move to a MA/MAPD plan?

Thanks in advance for sharing your thoughts.

 

[GreenSky]

Hi, I am seeing more insurance companies offer Medigap plans close their book of business when their premiums no longer remain competitive and then open a new book under a new subsidiary name and start the process over.

This practice may look good from a company's financial point of view, but the plan member that cant get thru underwriting (to switch plans/companies) may not share that same enthusiasm.

Some states have implemented the 'birthday rule' to give Medigap plan members the right to change plans without going thru underwriting either in the 30-day window before/after their birth month.

Are you aware of a study that is in the public domain that has researched the financial impact (lower monthly premiums in the long run) because of the birthday rule?

If you sell medigap plans and some of your customers have been caught up in the 'closed book of business situation', do you make them aware their vendor closed their book of business and point out their exposure to higher rates AND then their options to change plans to either another company's Medigap plan(s) or move to a MA/MAPD plan?

Thanks in advance for sharing your thoughts.

It's mutual of omaha that has the worst track record of closing books. Other carriers might do the same but not as often.

Why would any agent look for studies about the birthday rule?

The BD exists in only CA and OR. WA has a year 'round "birthday rule." MO has an anniversary rule.

In those states why would a consumer care if a company played the game of closing books since they can change at least once a year regardless of health?

In most states the beneficiary is screwed if they're not healthy enough to change. And going from supp to MA is rarely the best idea.

Rick