Humana Agents: MACRA and Medicare Supplement Important Announcement

MACRA goes into effect January 1, 2020. You are probably aware of this, but here’s a brief Q&A to help explain how this affects you and your clients.

What is MACRA?
MACRA is an acronym for Medicare Access and CHIP Reauthorization Act, legislation signed into law in 2015.

It is a law that states that anyone who is “newly eligible” for Medicare starting January 1, 2020, and beyond may not enroll in a Medicare Supplement Plan that covers the Part B deductible, such as plan C, F, or High Deductible F.

What does “newly eligible” mean?
“Newly eligible” are those who:

  1. Have attained age 65 on or after January 1, 2020
  2. First become eligible for Medicare due to age, disability, or end-stage renal disease, on or after January 1, 2020

What does that mean for my current clients already on one of these plans?
Your current clients who became eligible for Medicare prior to January 1, 2020, may continue to keep or even purchase plans that cover the Part B deductible. NO ACTION IS NECESSARY ON THEIR PART. You can reassure current policyholders that their plans will not change or go away. If they are on a plan that covers the Part B deductible today they can keep the plan they are on now.

The three states that obtained waivers from implementing the standardized Medicare Supplement plans (MA, MN, and WI) also must comply with eliminating coverage for the Part B deductible.

What if someone became eligible for Medicare prior to January 1, 2020, and wants to purchase a Plan F for a January 1, 2020 effective date?
Individuals are eligible to continue to enroll in a Plan C, F, or F(HD) (or other plan that covers the Part B deductible) after January 1, 2020, if they became Medicare eligible prior to January 1, 2020.

For individuals who will be “newly eligible”, what plan options will they have?
Plan options vary by market, of course. However, the closest substitute for Plan F is Plan G, which is already becoming a very popular choice for many Medicare-eligible individuals. The only difference between the two plans is coverage of the Part B Deductible, which is $185 for 2019.

Humana has introduced Plan G in most states, and is filing a High Deductible Plan G in all states as well. Not all have been approved yet, so check the Outline of Coverage for your state to confirm what’s available in.

What are the consequences if I sell a Medicare Supplement plan that covers the Part B deductible to a “newly eligible” individual?
Applications for these plans for those “newly eligible” will be denied and the agent will be investigated and subject to disciplinary action up to and including termination. Any person or company who sells or issues such policies to “newly eligible” Medicare beneficiaries after January 1, 2020 would be subject to fines, and/or imprisonment of not more than five years, and/or civil money penalties of not more than $25,000 for each prohibited act.

Have questions? Call us at 855-888-8326.

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October 15, 2020