Social Security & Medicare Questions: My HMO is Dropping Me. What Do I do Now?

Q: My Medicare Health Maintenance Organization (HMO) will be dropping coverage in our area. What do I do now? Will I be able to get coverage for my prescription drugs?

A: Even though your HMO may withdraw from Medicare, you will still be covered by the "original" fee-for-service Medicare program, but that does not include some of the extra benefits you received from your HMO such as coverage for prescription drugs. To protect your rights, and to ensure that there is no break in coverage, you will need to shop for other Medicare HMOs or supplemental plans in your area.  For up-to-date information about what plans are available in your area, call Medicare at (800) 633-4227 or via the Internet at http://www.medicare.gov .
 
You can get free health insurance counseling from your State Health Insurance Assistance Program which is available through your local Area Agency on Aging. For the number of the Agency nearest you, call the Eldercare Locator at (800) 677-1116 or go to http://www.eldercare.gov.
 
If your plan is withdrawing from Medicare it must notify you in writing by no later than October 2002.  Keep a copy of this termination letter and the postmarked envelope.  You may need this letter to show to another insurer as proof of loss of coverage.  The termination letter should contain a package of information that explains your options to return to original fee-for-service Medicare or enroll in another Medicare HMO if available.
 
Tip:
If you return to original fee-for service Medicare and you wish to buy a Medigap policy, you have certain protections as long as you apply no later that 63 days after the coverage from your old HMO expires (December 31, 2002) or no later than March 4, 2003. You are guaranteed the right to buy any Medigap policy designated "A", "B", "C," or "F" that is available in your state. (None of these plans offers prescription drug coverage.) If you apply within the above deadline, the insurance companies cannot deny you coverage or place conditions, such as waiting periods for coverage to start. In addition, the policy must cover you for all pre-existing conditions and cannot charge you more because of present or past health conditions.
 
Updated 8/02/02

This article first appeared in Volume 5, Issue 10 of "The Social Security and Medicare Advisor" newsletter (October/2000).  To receive future editions of "The Advisor" in its special, free e-mail version, please click here.

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