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Your Options and Rights If Your Employer
Drops Your Retiree Health Insurance
By: Glenn Silverberg
Bureau of Aging and Long term care recourses
About one-third of Wisconsin Medicare beneficiaries
supplement their Medicare with insurance through their former employer.
This coverage is usually better than individually bought Medicare ("Medigap")
supplement insurance. It often covers drugs, and costs less, because the
employer pays part of the premium. If you have such coverage, you are
usually wise to keep it if possible.
Unfortunately, a growing number of retirees are losing their insurance, or
having their coverage reduced, or their share of the cost increased beyond
their ability to afford it. Losing retiree benefits is a serious concern
for those affected.
You will likely end up paying more for less coverage to replace your
retiree health benefits, or if you go without additional coverage, you
will be responsible for all costs Medicare does not cover. You need to
know your rights, where to turn to enforce them, and whom to ask for
advice.
Your Options
1) You can purchase an individual Medicare supplement
policy. This is what most people will have to do. For assistance with
learning about and selecting a Medicare supplement, contact the Medigap
Helpline at 1-800-242-1060. If you purchase a policy within 63 days
after receiving notice that your employer plan is ending, you cannot be
turned down for a policy due to your health and there will be no waiting
period for coverage of pre-existing conditions. This open enrollment time
is called "guarantee issue."
-or-
2) If you have guarantee issue and act within the
63-day open enrollment window, you may enroll in the Medicare supplement
plan offered by the Health
Insurance Risk-Sharing Plan (HIRSP) sponsored
by the State of Wisconsin without the normal six-month exclusion of
pre-existing conditions. HIRSP offers a broader benefit package than
Medicare supplement insurance, including prescriptions, but because it
serves a high-risk population, it is more expensive. Some subsidies are
available to persons with household incomes below $25,000. Note that if
you are losing retiree coverage HIRSP also offers a high-deductible plan
for persons not yet eligible for Medicare. For information on HIRSP, call
1-800-828-4777. The Medigap
Helpline can also assist you.
-or-
3) Enroll in a Medicare managed care plan if you live
in a county that has one. In 2002, only Jackson, La Crosse, Monroe,
Vernon, Trempealeau, Milwaukee, Ozaukee, Washington, and Waukesha counties
have a Medicare managed care plan. Consider whether your primary physician
and other medical providers are part of the plan. Also, consider the
premiums and co-payments the plan requires, any additional services it
covers, and the fact that you must use only plan providers except in
emergencies.
-or-
4) Choose another employer health plan. This is
likely to be an option only if a plan is available through the current or
former employment of a spouse.
-or-
5) Consider government programs that can help with
health care costs. If you cannot afford supplemental insurance and have
limited income and assets, you should contact your county benefit
specialist to see if you qualify for help through available government
programs. This will soon include Wisconsin’s Senior
Care Program, which will provide a prescription drug benefit beginning
September 1, 2002 to low and moderate income persons age 65 and over.
Contact the benefit
specialist through your county
or tribal aging office.
Your Rights
You have a right to written notice 60 days before the
employer-sponsored plan ends. If the notice is given less than 60 days
before the termination date, the termination should not be effective until
60 days after the date the notice is given.
You have a right to receive a "certificate of credible coverage"
from the employer or insurer. This verifies that you have at least 18
months of previous group insurance coverage with no gap in coverage of
more than 62 days. This certificate is needed to show that you have
"guarantee issue" rights.
As described above, if you have guarantee issue, you have a right to a
63-day open enrollment period for purchasing a Medicare supplement policy.
This 63 days runs from when you receive the notice that your employer plan
is ending. It also applies if the plan reduces rather than ends your
coverage. When applying for a Medicare supplement policy (or the HIRSP),
submit a copy of the certificate of credible coverage with your
application to prove that you have guarantee issue. If you do not act
within 63 days, an insurer is free to turn you down or make you wait up to
six months for coverage of a pre-existing condition.
You have a right to consult with an objective person regarding your
options. In Wisconsin, your best bet is the Medigap
Helpline and the county benefit
specialist. You should also contact your former employer to provide
you with information, and your union if you are a union member or if a
union contract is involved.
If the employer plan that’s ending is a self-funded plan, to protect
your rights you need to know that it comes under the authority of the
federal Department of Labor (DOL). You
can contact the DOL Chicago office at (312) 353-0900. If the employer has
purchased insurance from an insurer, it is regulated by the State Office
of the Commissioner of Insurance
(1-800-236-8517).
Do not hesitate to ask for help from the Medigap
Helpline or county or tribal benefit
specialist in advocating for your rights.
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