Through the approximately $141 million National Medicare Education Program, Medicare & You, HCFA has been working with public and private partners that represent tens of millions of older and disabled Americans to provide information to beneficiaries about their rights and options under Medicare+Choice. As part of this effort, we help beneficiaries understand their options when a plan withdraws. A key piece of this information is that beneficiaries are automatically eligible to return to original fee-for-service Medicare and that they have guaranteed access to some Medigap policies that help fill coverage gaps if their Medicare+Choice organizations leave the program.

Medicare+Choice Plan Participation in 2001

• About 85 percent of current M+C enrollees will be able to continue with their current Medicare HMO in 2001.

• Of the 934,000 beneficiaries affected by plan nonrenewals, the majority (775,000) will continue to have a Medicare+Choice plan in their area.

• Since July 1998, HCFA has approved 58 applications for M+C organizations to begin service or expand a service area. HCFA recently approved its first private fee-for-service option, which serves 11 total states and portions of six others (a total of over 1,200 counties with 8.2 million Medicare eligibles). HCFA is currently reviewing five new M+C applications, including two preferred provider-type organizations. Five current M+C organizations have submitted service area expansions.

Supplemental Insurance Through Medigap

Congress enacted legislation in 1999 that added a new time period where beneficiaries have access to Medigap policies when a plan leaves Medicare. Beneficiaries will continue to have certain rights and protections when purchasing Medigap policies. Beneficiaries have two options:

• First, beneficiaries in Medicare+Choice plans who want to switch to original fee-for-service Medicare may do so as soon as they receive their final notice from their Medicare+Choice plans. If they choose this option, beneficiaries have 63 days from the date of the notice (from October 2, 2000 until December 4, 2000) to apply for a Medigap policy and be guaranteed the same

protections they would have if they waited until their coverage expired on December 31, 2000. To exercise this option, beneficiaries must disenroll from their Medicare+Choice plan in October or November, and arrange for their Medigap policy to start the first day of the next month so they will have seamless coverage between the plans they choose.

• Second, beneficiaries may remain enrolled in their plan through the end of the year. As long as they apply for a Medigap policy no later than 63 days after the coverage with the nonrenewing HMO expires (December 31, 2000), the beneficiary is guaranteed the right to buy any Medigap policy designated “A,” “B,” “C” or “F” that is available in the state. If the beneficiary applies for one of these Medigap policies no later than March 4, 2001, companies selling these policies cannot place conditions on the policy (such as an exclusion of benefits based on a pre-existing condition) or discriminate in the price of the policy because of health status, claims experience, receipt of health care or medical condition.

CAUTION: Individuals must keep a copy of their HMO’s termination letter to show a Medigap insurer as proof of loss of coverage under this HMO, whether they terminate their membership in October or November or wait until their coverage ends at the end of December. They should also keep a copy of their Medigap application to validate that they acted within 63 days of the final notice of termination.

If beneficiaries dropped a Medigap policy to join their current Medicare managed care plan and they have never enrolled in a similar health plan since starting Medicare, they are guaranteed the right to return to the Medigap policy they dropped if: the Medigap policy they dropped is still being sold by the same insurance company; they disenroll from their current health plan no later than 12 months after they initially enrolled in it (they have to disenroll from their plan before their coverage terminates on December 31, 2000); and they reapply for the policy they dropped no later than 63 days after they disenroll from their Medicare managed care plan.

In addition, beneficiaries who were new to Medicare at age 65 and chose to enroll in their Medicare+Choice plan during their initial election period, and are still in their first 12 months in the Medicare+Choice plan, may choose any Medigap policy sold in the State, including those providing some outpatient prescription drug coverage. These individuals must voluntarily disenroll from the Medicare+Choice plan before the 12 months ends and apply for the Medigap policy within 63 days of their coverage ending.

Supplemental Coverage for Retirees Enrolled in an Employer-Sponsored Plan

Beneficiaries whose former employer has an arrangement with the Medicare+Choice organization offering the Medicare+Choice plan in which they are enrolled should consult with their employer.

Affected Beneficiaries May Be Able to Retain Their Doctors

Beneficiaries who choose to return to original fee-for-service Medicare will probably be able to continue to see the same physicians that they had seen through the HMO because most HMO physicians -- more than 90 percent -- also participate in original fee-for-service Medicare. If there are other Medicare+Choice organizations in the beneficiaries’ geographic area, some of their current physicians may also participate with those Medicare+Choice plans.

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