Special Election Period (SEP) Question

[insurance0707]

I've run across a couple. They have group coverage that runs $400 per month and it doesn't cover prescriptions. They had to take out a Humana stand alone prescription plan.

I have a MAPD plan that runs about $90 per month per person that covers prescriptions and medical all in one that they are interested in. Do these people have to wait until Nov 15th enrollment period or would they qualify for an SEP if they cancelled their group coverage. I know if the group coverage cancels them then they qualify for SEP but what if the people cancel the group?

thanks in advance

 

[insurance0707]

They could go from paying $450 a month down to $180 if they can make the change now

 

[Guest]

They have to wait until 11/15

 

[midwestbroker]

I have ran into that and I have had no problems enrolling people using this SEP code

SEP - LEC (Loosing Employer Coverage)

They will need a letter of creditable coverage from their employer.

According to the rules of Medicare they will have to wait, but like I said, I have had no problem with the apps going through.

 

[Guest]

I have ran into that and I have had no problems enrolling people using this SEP code

SEP - LEC (Loosing Employer Coverage)

They will need a letter of creditable coverage from their employer.

According to the rules of Medicare they will have to wait, but like I said, I have had no problem with the apps going through.

If you use that code then of course they will allow it...but on the apps you would have to be stating that they are losing their coverage, which they are not...they are cancelling it voluntarily. That code is only supposed to be used if they are losing coverage at no fault of their own. At least that's my understanding.

 

[GreenSky]

I don't recall reading that your group termination must be involuntary, but I could be wrong.

The termination letter on the group will likely not show who's idea it was.

Rick

 

[Dave020]

I've enrolled MAPD with client dropping group coverage voluntarily

 

[insurance0707]

Thanks for the responses....I have used SEP before for this scenario also, but it was during the Jan 1 - March 31 enrollment period where they could technically still make the change. I wasn't sure when it's outside that enrollment period though.

 

[Cenla Agent]

If you use that code then of course they will allow it...but on the apps you would have to be stating that they are losing their coverage, which they are not...they are cancelling it voluntarily. That code is only supposed to be used if they are losing coverage at no fault of their own. At least that's my understanding.

Some of the SEP's like this can be a little tricky. There have been times where I've asked questions like this of 3-4 different people from the carrier and Medicare and gotten a different answer every time. Sometimes it takes a while to really nail it down. My understanding has been that this is for losing coverage involuntarily as well, but as Kyle said, that could be wrong.

Another question is, when is their open enrollment for their group? If they can't get out of it during the AEP/OEP, how are they ever going to switch to MA if that's what they want to do (assuming that the SEP is for involuntary loss of coverage only)? Some plans do not run from 1/1-12/31, but may be 6/1-5/31, etc.

In my experience, it is seldom in a beneficiaries best interest to switch from group to MA, especially considering the continued volatility of the MA plans, and I've never written an MA in this situation. Also consider that if they currently have drug coverage, they will be going from that to a plan that has the coverage gap in most cases. The one exception would be someone who basically cannot afford the group plan anymore (as in the case in the OP), or maybe the deductibles are so high on their plan that something totally catastrophic has to happen before it ever pays.

Something else that is out there that I haven't looked into much is the possibility of setting up Group MA's for employers with a certain number of retirees. Some state retirement systems have done this and you can do it for any group that has 10 or more (I think, not 100% sure of the number) Medicare beneficiaries. The possibility of something like this becoming available is one reason why people should be very reluctant to drop group coverage since if their company does it after they drop out, they will not be eligible. Perhaps we can start a new thread on this if anyone else knows more about it.

 

[insurance0707]

Some of the SEP's like this can be a little tricky. There have been times where I've asked questions like this of 3-4 different people from the carrier and Medicare and gotten a different answer every time. Sometimes it takes a while to really nail it down. My understanding has been that this is for losing coverage involuntarily as well, but as Kyle said, that could be wrong.

Another question is, when is their open enrollment for their group? If they can't get out of it during the AEP/OEP, how are they ever going to switch to MA if that's what they want to do (assuming that the SEP is for involuntary loss of coverage only)? Some plans do not run from 1/1-12/31, but may be 6/1-5/31, etc.

In my experience, it is seldom in a beneficiaries best interest to switch from group to MA, especially considering the continued volatility of the MA plans, and I've never written an MA in this situation. Also consider that if they currently have drug coverage, they will be going from that to a plan that has the coverage gap in most cases. The one exception would be someone who basically cannot afford the group plan anymore (as in the case in the OP), or maybe the deductibles are so high on their plan that something totally catastrophic has to happen before it ever pays.

Something else that is out there that I haven't looked into much is the possibility of setting up Group MA's for employers with a certain number of retirees. Some state retirement systems have done this and you can do it for any group that has 10 or more (I think, not 100% sure of the number) Medicare beneficiaries. The possibility of something like this becoming available is one reason why people should be very reluctant to drop group coverage since if their company does it after they drop out, they will not be eligible. Perhaps we can start a new thread on this if anyone else knows more about it.

This couple doesn't have prescription coverage under their group plan. They had to take out a seperate stand alone plan. So either way, they'll have a gap in coverage/doughnut hole if their prescriptions go beyond $2,400. You're right though, usually a group plan does have better prescription coverage than a MAPD.

I'm just starting to hear about the Group MAPD plans in Michigan. I was supposed to go to a meeting on it but just couldn't make it. I need to research those a little more. From my understanding of the group MAPD they wouldn't have the gap in coverage/doughnut hole either under those plans. The premiums are a little higher than a regular MAPD but with better rx coverage. I believe it's United Health care that is offering them in MI.