At a glance: Medicare health insurance in Delaware
- More than 21 percent of the state’s population is enrolled in Medicare.
- Only 16 percent of Delaware Medicare beneficiaries select Medicare Advantage plans.
- Residents in Delaware can select from 17 or 19 Medicare Advantage plans in 2020, depending on where they live.
- Delaware law protects access to Medigap plans for enrollees under age 65. But premiums are higher for those under 65, and drastically higher for under-65 enrollees who have end-stage renal disease.
- Nearly two-thirds of Delaware Medicare beneficiaries have stand-alone Part D prescription coverage.
- Per-enrollee Medicare spending in Delaware is just slightly lower than the national average.
Medicare enrollment in Delaware
As of November 2019, there were 209,392 Delaware residents enrolled in Medicare. That’s more than 21 percent of the state’s total population, compared with a little less than 19 percent of the United States population enrolled in Medicare.
Delaware is in the top ten states in the US in terms of having the highest percentage of elderly residents, and although Medicare covers both aged and disabled populations, most enrollees are eligible due to being at least 65 years old. In Delaware, 86 percent of Medicare beneficiaries are eligible due to age, versus just 14 percent who are eligible due to a disability.
Medicare Advantage in Delaware
By the end of 2019, enrollees with private Medicare coverage (instead of Original Medicare; this does not count Original Medicare beneficiaries who supplement their coverage with private Medigap and/or Part D plans) stood at 34,482, which was more than 16 percent of the state’s Medicare population. Virtually all of these individuals had coverage under Medicare Advantage plans.
Nationwide, more than 37 percent of Medicare beneficiaries had private coverage at that point. Again, nearly all of those beneficiaries had Medicare Advantage plans, but there were also some enrollees with Medicare Cost plans, which are another type of private Medicare coverage available in some areas (there are no Medicare Cost plans in Delaware). Although more than a third of Medicare beneficiaries nationwide have opted for private coverage, only 16 percent of Delaware’s Medicare population has done so; Original Medicare remains much more popular in the state.
But for those who do want Medicare Advantage coverage, residents in Delaware can choose from among 17 or 19 different Medicare Advantage plans for 2020, depending on where they live. And during the Medicare Advantage open enrollment period (January 1 to March 31) people who are already enrolled in Medicare Advantage plans can switch to a different Medicare Advantage plan or switch to Original Medicare.
Medigap in Delaware
Medigap plans are used to supplement Original Medicare, covering some or all of the out-of-pocket costs (for coinsurance and deductibles) that people would otherwise incur if they only had Original Medicare on its own.
There were 23 insurers offering Medigap plans in Delaware as of 2019.
Medigap plans are standardized under federal rules, and people are granted a six-month window, when they turn 65 and enroll in Original Medicare, during which coverage is guaranteed issue for Medigap plans. But federal rules do not guarantee access to a Medigap plan if you’re under 65 and eligible for Medicare as a result of a disability. States can set their own rules, however, and Delaware enacted a law in 2013 that grants a six-month guaranteed issue window for Medigap when people become eligible for Medicare as a result of a disability.
Under the terms of the legislation, Medigap insurers in Delaware that sell plans to people who are 65+ must make all of their plans available to people who are under 65 and enrolled in Medicare due to a disability. But the legislation allows insurers to charge higher premiums for people under age 65, and specifically prohibits insurers from increasing premiums for the 65+ population in order to cover the additional risk involved in providing coverage for disabled Medicare beneficiaries. The legislation requires insurers to have two separate risk pools (and thus separate pricing) for under-65 enrollees who are eligible due to end-stage renal disease (ESRD) versus under-65 enrollees who are eligible due to all other disabling conditions.
But due to this provision, Medigap premiums are dramatically higher for under-65 Delaware residents with ESRD. In many cases, premiums for an under-65 enrollee with ESRD exceed $20,000 per year, while under-65 enrollees without ESRD are generally charged premiums in the range of $4,000 to $7000 per year, and people who are age 65 typically pay somewhere in the range of $1,000 to $2,500 per year (premiums vary considerably from one insurer to another; these ranges cover most plans, but not all of them).
The separate risk pool and sharply higher Medigap premiums for under-65 enrollees with ESRD is particularly important given that ESRD is also the only condition that prevents a person from enrolling in most Medicare Advantage plans (there are some Medicare Advantage plans that are set up as Special Needs Plans for people with ESRD, but most Advantage plans will not accept a new enrollee with ESRD; nationwide, there are only eight SNPs for people with ESRD in 2019, and none of them appear to be available in Delaware). As of 2021, however, under the terms of the 21st Century Cures Act, people with ESRD will no longer be barred from enrolling in Medicare Advantage plans nationwide.
Under federal Medigap rules, all Medicare beneficiaries have a guaranteed-issue open enrollment period when they’re at least 65 years old and enrolled in Medicare Part B. So enrollees in Delaware who are under-65, including those with ESRD, have the option to get a new plan with standard age-65 rates when they turn 65.
Most Medigap insurers in Delaware use attained-age rating, which means that premiums increase as the enrollee gets older. Some insurers use issue-age rating, which means premiums are based on the age the person was when they initially enrolled. United Healthcare uses community rating (ie, rates don’t vary based on age) for enrollees who are age 75 or older.
Part D coverage in Delaware
As of November 2019, 131,601 Delaware Medicare beneficiaries were enrolled in stand-alone Part D prescription drug plans. That’s 63 percent of the state’s total Medicare beneficiaries (for comparison, less than 43 percent of all Medicare beneficiaries nationwide are enrolled in stand-alone Part D plans). In areas where Medicare Advantage enrollment is lower, enrollment in stand-alone Part D plans tends to be higher.
For 2019 coverage, there are 27 stand-alone Part D plans for sale in Delaware, with premiums ranging from $13 to $80 per month. Original Medicare does not cover outpatient prescription drugs. But Medicare beneficiaries can get prescription coverage via a Medicare Advantage plan, an employer-sponsored plan (offered by a current or former employer), or a stand-alone Part D plan.
Medicare spending in Delaware
In 2017, Original Medicare spent an average of $9,508 per beneficiary in Delaware (the spending analysis did not include costs for Medicare Advantage enrollees, but it did standardize the data to eliminate differences in payment rates from one area to another). The national average that year was $9,761 per enrollee, so costs were only slightly lower than average in Delaware.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.