Entering and Leaving Medicare Advantage Plans

What Is Medicare Advantage?

Medicare Advantage, also known as Medicare Part C, is an alternative to traditional Medicare coverage and is offered by private health insurance companies. Medicare Advantage plans include Medicare Parts A and Part B (Original Medicare). Part C plan options provide all the benefits of Original Medicare and often include additional benefits, such as prescription drug coverage (Part D) and dental, vision, and hearing services not normally covered by Original Medicare.

Today, Medicare Advantage plans cover more than half (around 54 percent) of the eligible Medicare population. In 2024, the average Medicare applicant has access to more than 40 Medicare Advantage plans from eight companies.

Despite their popularity, around half of Medicare Advantage enrollees leave their plan after five years, according to a study from the Brown University School of Public Health. However, most who disenroll go to another Medicare Advantage plan rather than switch to traditional Medicare, the study found.

Why Are People Switching Medicare Advantage Plans?

The Brown University researchers note that Medicare Advantage beneficiaries with greater health needs disenroll at higher rates over time, which they say could be indicative of unmet needs and “discontent” with their plans.

Experts speculate that the low premium costs and added perks of Medicare Advantage plans initially attract new enrollees, particularly those who are younger and healthier when they first join. However, they can feel “trapped” in these plans as they become older and sicker and face restricted access to many services and in some cases higher out-of-pocket costs.

If a patient with chronic health issues wants to leave Medicare Advantage, they may not be able to switch to Original Medicare due to cost concerns.

The lead author of the Brown University study told KFF Health: “Once you get into Medicare Advantage, if you have a couple of chronic conditions and you want to leave … even if [it] isn’t meeting your needs, you might not have any ability to switch back to traditional Medicare.”

Medicare Supplement Plans (Medigap) Not Available to Medicare Advantage Enrollees

Original Medicare, unlike Medicare Advantage, does not have out-of-pocket maximums. Patients enrolled in Original Medicare pay a monthly premium and typically are subject to 20 percent co-insurance after they reach their deductible.

To limit their out-of-pocket costs, Original Medicare enrollees often buy a Medigap policy. But Medigap insurers are not required to sell patients a policy unless they are within their initial six-month open enrollment period when they first start Medicare, or if they have certain qualifying life events that trigger a “guaranteed issue” period.

Outside these defined periods, Medigap insurers can deny coverage to patients switching from Medicare Advantage to Original Medicare or charge them higher rates based on their medical history. Just four states — Connecticut, Maine, Massachusetts, and New York — prohibit insurers from denying a Medigap policy because of preexisting conditions like diabetes and heart disease.

A former commissioner on the Medicare Payment Advisory Commission says the inability to switch easily between Medicare Advantage and Original Medicare is “a real concern in our system.”

How to Enroll in Medicare Advantage

You generally must be enrolled in Medicare Parts A and Part B before you can enroll in a Medicare Advantage plan. To join a Medicare Advantage plan, contact the plan and inquire whether it is accepting new members or has a waiting list.

• You may enroll in Medicare Advantage during the seven-month period that starts three months before the month you turn 65, includes the month you turn 65, and ends three months after the month you turn 65. This is called the Initial Enrollment Period.
• You can also enroll in a plan or switch plans during open enrollment between October 15 and December 7 for coverage beginning January 1.
• If you only get Part B after your Part A coverage starts, you can enroll in the three months before your Part B starts (Initial Enrollment Period – New to Part B).

Medicare Advantage does not always accept new enrollments. Some plans have approved limits on the number of beneficiaries that can join a plan (called “capacity limits”). Once a plan has reached its capacity limit, it does not have to accept anyone new. If a plan refuses to accept your enrollment, it must provide a written denial.

How to Leave or Switch Medicare Advantage Plans

Once you join Medicare Advantage, you can disenroll from it only at specific times of the year.

• You can switch once during the Medicare Open Enrollment Period that runs from October 15 through December 7.
   
• In addition, you can switch Medicare Advantage plans or switch from Medicare Advantage to Original Medicare between January 1 and March 31 (Medicare Advantage Open Enrollment Period). However, you can’t switch from Original Medicare to Medicare Advantage during this time. You also can’t switch prescription drug plans or join, switch, or drop a Medicare Medical Savings Account Plan during this period.
  
  If you switch to Original Medicare during this period, you’ll have until March 31 to join a Medicare prescription drug plan. Your coverage will begin the first day of the month after the plan receives your enrollment form.
   
• A Special Enrollment Period (SEP) is available in limited circumstances on a case-by-case basis, including when you change where you live; lose your current coverage; your plan changes its contract with Medicare; or you have the chance to get other coverage through a different provider.
  
  An SEP might be allowed, for example, if there is a “significant change in your plan’s provider network,” Medicare explains. One such exception can occur when your doctors have been dropped from a Medicare Advantage plan, which can happen in the middle of a plan year without much warning.
  
  This exception applies only when significant provider changes have occurred, so more than one doctor would have to be terminated from the plan. The SEP begins the month you are notified of the change and continues for two months. You can leave your Medicare Advantage plan and join Original Medicare or switch to another Medicare Advantage plan during this time.
  
  Another allowable exception occurs in cases where a Medicare Advantage provider ends its contract with Medicare. Providers enter 12-month contracts (January to December) with the Medicare program. Each year, plans can choose whether to renew their contracts. They typically must notify Medicare officials by July 1 if they are not going to renew for the following year.

If you are eligible to leave a Medicare Advantage plan for any reason, you can cancel your plan in the following ways:

• Call the plan provider and ask for a disenrollment form.
• Call 1-800-MEDICARE to request your disenrollment.
• Call the Social Security Administration or visit your Social Security Office to file a disenrollment request.

You don’t have to fill out a disenrollment form if you decide to join another Medicare Advantage plan. You will be automatically disenrolled from your old plan when your new plan becomes effective.

If you leave Medicare Advantage, you automatically return to Original Medicare. In most cases, you should be able to use the same providers you were using in your Medicare Advantage plan.

Medicare lets you use any doctor or hospital that takes Medicare, anywhere in the United States. But if you switch from Original Medicare to Medicare Advantage, you can only use doctors in the plan’s network. It can be more difficult to find specialists with a Medicare Advantage plan, especially in rural areas.

The Medigap Gap

A major risk of moving from Original Medicare to a Medicare Advantage plan is that when you leave traditional Medicare, you may not be eligible for the same Medigap policy you had before you switched to Medicare Advantage.

When you return to regular Medicare, you have the right to go back to the same Medigap policy you had before you joined the Medicare Advantage plan if the same insurance company you had previously still sells it.

If the policy is no longer available, you have a guaranteed right to buy a Medigap policy designated A, B, C, F, K or L that is sold in your state by any insurance company, as long as you had Medicare Advantage for less than a year.

In these circumstances, insurers cannot refuse you coverage if you apply for the Medigap policy no later than 63 days after coverage from your Medicare Advantage plan terminates. The insurer is required by law to sell or offer you a Medigap policy even if you have health problems (i.e., preexisting conditions). If you had Medicare Advantage for a year or more or wait longer than 63 days, you can apply, although your acceptance isn’t guaranteed.

Feeling “trapped” by your Medicare Advantage plan and want to explore your options? Talk to your elder law attorney about how to get a new plan without losing the current benefits you count on.