What You Should Know about the Medigap Underwriting Process

Guest Post by Danielle K. Roberts

When your Medicare benefits begin, your Part B effective date kicks off a 6-month open enrollment window during which new Medicare beneficiaries can enroll in any Medigap plan with no health questions asked.

However, once that window has passed, changing plans will require underwriting in most states.

We often get asked about what this underwriting entails. Here’s what you need to know:

It starts with your application

Medigap applications come with a page of health questions which you must answer if you are not in your open enrollment period or a guaranteed issue period after rolling off employer insurance. In most instances, the insurance carrier wants you to be able to answer “no” to all the health questions. Some insurance companies won’t allow any “yes” answers at all and instruct the agent to automatically decline the application if the applicant answers yes to any questions.

While chronic conditions like COPD or congestive heart failure will often cause an automatic decline, other things won’t necessarily be a problem. For instance, if you take a few routine medications, such as a blood pressure medication or a thyroid medication, these are often not a problem if they aren’t part of treating a larger health condition.

On the flip side of that, just because you answer “no” to all of the health questions doesn’t mean you will be approved. This is just the first step that qualifies your entry into the underwriting process. Ultimately, the underwriter at the insurance company will decide whether to approve you after reviewing your application and medical records they can find.

Medical questions vary by company, so if you can’t pass one carrier’s health questions, your agent may know of another carrier that has different questions. He or she may suggest that you apply there instead to give you the best chance of being approved. You can find some examples of underwriting questions here.

Apply after any pending medical appointments

When applying for a Medigap plan, you should do so after you have completed any pending medical procedures, surgeries, or follow-ups. Something as small as one last pending physical therapy session after a surgery that occurred months ago can cause a decline.

If you have any kind of medical follow-up appointment on your calendar, get that done first and then apply for your Medigap plan afterward.

Your prescriptions matter

Underwriters have access to systems that will pull up records of any prescriptions that you have been prescribed over the last several years. For this reason, it is very important to be honest on your application and list all of the medications that you are taking or have taken recently (if the application asks for that).

Medigap insurance companies also publish Underwriting Guidelines for agents that list all of the medications that will cause an automatic decline. Certain medications indicate that you have an underlying health condition, so if you take one of these medications, you are not eligible for coverage.

Important tip: The underwriter can usually find records of any medication that has been prescribed to you even if you no longer take the medication. Often, we see problems occur when a client goes into their doctor about an issue, and the doctor prescribes a medication. The client thinks “I don’t need that,” and they never take the medication. Just because you choose not to fill the prescription doesn’t mean it’s not in your records.

For example, if you mention feeling a bit foggy to your doctor and he prescribes Namenda for memory loss, you will run into a problem. This drug is associated with Alzheimer’s disease and dementia and will cause an automatic decline in most instances.

If your doctor talks to you about a medication that you think you don’t need, tell the doctor NOT to prescribe it. This will help to prevent it from getting on your prescription history.

Don’t overshare

When the underwriter calls you to ask health questions, don’t share anything more than what they ask. Give yes or no answers whenever possible. When you volunteer information, that can sometimes lead you down a rabbit hole that you don’t want to go into.

Sometimes applicants want to share that they have recently lost a bunch of weight or they were able to drop all their diabetes medications. While you may view this as positive, underwriters are sometimes wary of recent changes like this as they want you to have had enough time to stabilize on those medications.

Going into any application knowing these things about the underwriting process should help both you and your agent to decide whether it makes sense to try applying with a new Medigap company.

Danielle K. Roberts is a Medicare insurance expert and co-founder at Boomer Benefits where she and her team help thousands of beneficiaries navigate their Medicare decisions every year.