At a glance: Medicare health insurance in Indiana
- In Indiana, more than 1.27 million residents are enrolled in Medicare.
- More than a third of Indiana Medicare beneficiaries are enrolled in Medicare Advantage plans.
- 47 insurers offer Medigap plans in Indiana. As of July 2020, Indiana requires Medigap insurers to offer at least Plan A to people under age 65, but the premiums are significantly higher than the premiums for a 65-year-old.
- More than three-quarters of Indiana Medicare beneficiaries have Part D prescription coverage, either under a stand-alone plan or as part of their Medicare Advantage plans.
- Per-enrollee Original Medicare spending in Indiana is slightly higher than the national average.
Medicare enrollment in Indiana
As of June 2020, Medicare enrollment in Indiana stood at 1,275,951 people, which is about 19 percent of the state’s population.
For most Americans, turning 65 is the path to Medicare enrollment. But younger Americans become eligible for Medicare if they have been receiving disability benefits for 24 months, or if they have ALS or end-stage renal disease. Nationwide, 15 percent of all Medicare beneficiaries were under age 65 as of 2017; in Indiana, it was slightly higher, at 17 percent.
Original Medicare in Indiana (Medicare Parts A and B)
Original Medicare, which includes Medicare Part A and Medicare Part B, is a federally-run program that does not vary from one state to another. So general Medicare eligibility in Indiana and Medicare enrollment in Indiana work the same way they do in every other state. For residents who aren’t yet receiving Social Security retirement benefits and thus aren’t automatically enrolled when they turn 65, the Medicare application in Indiana is done via the Social Security Administration, as is the case nationwide.
But the availability and pricing of private Medicare coverage, including Medicare Advantage plans, Medigap plans, and Medicare Part D plans, does vary from state to state. Read on for more information that’s specific to Indiana.
Medicare Advantage in Indiana
Medicare beneficiaries can choose to receive their benefits directly from the federal government via Original Medicare or enroll in a private Medicare Advantage plan (as long as Advantage plans are available in their area, which is the case in most of the country). There are pros and cons to either option, and the right approach differs depending on the enrollee’s circumstances and coverage needs.
Twenty-eight percent of Medicare beneficiaries in Indiana were enrolled in Medicare Advantage plans as of 2018, compared with an average of 34 percent nationwide. As of mid-2020, there were 458,330 Indiana Medicare beneficiaries enrolled in private Medicare plans (as opposed to Original Medicare; that figure does not include people who had private coverage to supplement Original Medicare), which amounted to nearly 36 percent of the state’s Medicare population. That’s in keeping with the national trend of increasing enrollment in Medicare Advantage plans over the last several years.
Medicare Advantage plan availability varies from one country to another. In 2020, Indiana residents can choose from among at least 11 Medicare Advantage plans, and up to 30 plans, depending on where they live.
Medicare’s annual election period (October 15 to December 7 each year) gives Medicare beneficiaries the opportunity to switch between Medicare Advantage and Original Medicare (and add or drop a Medicare Part D prescription plan). There is also a Medicare Advantage enrollment window that allows people who are already enrolled in Medicare Advantage plans to switch to a different Advantage plan or to Original Medicare. This is known as the Medicare Advantage open enrollment period, which runs from January 1 to March 31
Medigap in Indiana — Plan A now guaranteed issue for disabled enrollees, but with higher premiums
More than half of Original Medicare beneficiaries receive supplemental coverage through an employer-sponsored plan or Medicaid. But for those who don’t, Medigap plans (also known as Medicare supplement plans) are designed to pay some or all of the out-of-pocket costs (deductibles and coinsurance) that Medicare beneficiaries would otherwise have to pay themselves. Original Medicare does not limit out-of-pocket costs, so most enrollees maintain some form of supplemental coverage; Medigap plans are what’s available for people who don’t have access to an employer-sponsored plan (including retiree plans) or Medicaid.
Although Medigap plans are sold by private insurers, the plans are standardized under federal rules. There are ten different plan designs (differentiated by letters, A through N), and the benefits offered by a particular plan (Plan A, Plan F, etc.) are the same regardless of which insurer is selling the plan. So plan comparisons are much easier for Medigap policies than for other types of health insurance; consumers can base their decision on premiums and less tangible things like customer service, since the benefits themselves are uniform.
47 insurers offer Medigap plans in Indiana. UnitedHealthcare/AARP also offers Medicare SELECT Medigap plans in Indiana. According to an AHIP analysis, 320,219 people in the state had Medigap coverage as of 2018.
Unlike other private Medicare coverage (Medicare Advantage and Medicare Part D plans), there is no annual open enrollment window for Medigap plans. Instead, federal rules provide a one-time six-month window when Medigap coverage is guaranteed-issue. This window starts when a person is at least 65 and enrolled in Medicare Part B (you must be enrolled in both Part A and Part B to buy a Medigap plan).
People who aren’t yet 65 can enroll in Medicare if they’re disabled and have been receiving disability benefits for at least two years, and 17 percent of Indiana’s Medicare beneficiaries are under age 65. But federal rules do not guarantee access to Medigap plans for people who are under 65. However, the majority of the states have rules to ensure that disabled Medicare beneficiaries have at least some access to Medigap plans. As of mid-2020, Indiana is among them, thanks to legislation that was enacted in 2019 (S.B.392).
The bill passed with strong support in both chambers of Indiana’s legislature, and was signed into law in May 2019. As of July 2020, it requires Medigap insurers to offer at least one Medigap plan (Plan A) to Medicare beneficiaries who are under 65 and eligible for Medicare due to a disability. The legislation requires Medigap insurers to grant Medicare beneficiaries a six-month open enrollment period that begins when they’re enrolled in Part B (or determined eligible for retroactive Part B coverage), regardless of age. And for Indiana residents who are under 65 and already enrolled in Medicare due to a disability, a one-time six-month enrollment window began July 1, 2020.
Prior to mid-2020, Medigap insurers in Indiana were not required to offer coverage to beneficiaries under the age of 65—and none of them voluntarily chose to do so.
Indiana joined several other states that require Medigap insurers to offer at least one plan on a guaranteed-issue basis to disabled Medicare beneficiaries. But unlike some of those states, Indiana’s legislation does not limit premiums for these enrollees (ie, there is no requirement that premiums be the same as the rates for people who are 65). As an example, premiums for Plan A for a 65-year-old woman in Indianapolis range from about $77 to $336/month in 2020. But if she’s 64 instead, the premiums for the available plans range from about $234 – $649/month.
Medicare beneficiaries under age 65 can enroll in Medicare Advantage plans unless they have end-stage renal disease (in some areas, Medicare Advantage Special Needs Plans for people with end-stage renal disease are available, and as of 2021 as a result of the 21st Century Cures Act, Medicare Advantage plans will be guaranteed issue for all Medicare beneficiaries, including those with ESRD).
Although the Affordable Care Act eliminated pre-existing condition exclusions in most of the private health insurance market, those regulations don’t apply to Medigap plans. Medigap insurers can impose a pre-existing condition waiting period of up to six months, if you didn’t have at least six months of continuous coverage prior to your enrollment. And if you apply for a Medigap plan after your initial enrollment window closes (assuming you aren’t eligible for one of the limited guaranteed-issue rights), the insurer can look back at your medical history in determining whether to accept your application, and at what premium.
Medicare Part D in Indiana
Original Medicare does not cover outpatient prescription drugs. More than half of Original Medicare beneficiaries have supplemental coverage via an employer-sponsored plan (from a current or former employer or spouse’s employer) or Medicaid, and these plans often include prescription coverage. But Medicare enrollees without drug coverage through Medicaid or an employer-sponsored plan need to obtain Medicare Part D prescription coverage. Part D coverage can be purchased as a stand-alone plan, or as part of a Medicare Advantage plan that includes Part D prescription drug coverage.
In 2020 in Indiana, there are 28 stand-alone Part D plans for sale, with premiums that range from about $13 to $75/month.
As of mid-2020, there were 1,002,529 Indiana Medicare beneficiaries who had Part D prescription coverage. About 60 percent had coverage under stand-alone Part D plans, while about 40 percent had Part D prescription coverage as part of their Medicare Advantage plans.
Medicare Part D enrollment is available when a beneficiary first becomes eligible for Medicare. And the annual Medicare election period each fall (October 15 to December 7) allows beneficiaries the opportunity to switch to a different Medicare Part D plan or enroll for the first time if they didn’t do so when they were first eligible, although a late enrollment penalty can be assessed if they didn’t have creditable coverage prior to enrolling.
Medicare spending in Indiana
In 2018, Original Medicare’s average per-beneficiary spending in Indiana was $10,176 (based on data that were standardized to eliminate regional differences in payment rates, and did not include costs for Medicare Advantage).
Nationwide, average per beneficiary Original Medicare spending was $10,096 per enrollee, so Medicare spending in Indiana was about 1 percent higher than average. Per-beneficiary Original Medicare spending was highest in Louisiana, at $11,932, and lowest in Hawaii, at just $6,971.
You can contact the Indiana State Health Insurance Assistance Program with questions related to Medicare coverage in Indiana, including Medicare eligibility in Indiana or Medicare enrollment in Indiana.
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.