At a glance: Medicare health insurance in New Mexico
- More than 413,000 New Mexico residents are enrolled in Medicare — almost 20 percent of the state’s population.
- Nearly 35 percent of New Mexico Medicare beneficiaries are enrolled in Medicare Advantage plans
- Medicare Advantage availability in New Mexico ranges from two to 23 plans, depending on the county.
- 30 insurers offer Medigap plans in New Mexico; the state does not require Medigap insurers to offer coverage to people under age 65, but high-risk pool coverage is available for Medicare beneficiaries under age 65 who cannot get private Medigap plans.
- There are 27 stand-alone Part D prescription plans available in New Mexico in 2019, with premiums that range from about $15 to $126 per month. About 71 percent of New Mexico Medicare beneficiaries have Part D coverage, either as stand-alone plans or integrated with Medicare Advantage.
- Per-enrollee Original Medicare spending in New Mexico is significantly lower than the national average.
Medicare enrollment in New Mexico
413,324 New Mexico residents were enrolled in Medicare as of December 2018. That’s nearly 20 percent of the state’s population, versus a little more than 18 percent of the total US population enrolled in Medicare.
Most Americans become eligible for Medicare when they turn 65. But younger Americans gain Medicare eligibility after they have been receiving disability benefits for 24 months, or if they have ALS or end-stage renal disease. Nationwide, 16 percent of all Medicare beneficiaries were under age 65 as of 2017; in New Mexico, it was 17 percent.
Medicare Advantage in New Mexico
Private Medicare Advantage plans are an alternative to Original Medicare. There are pros and cons to either option, and the right solution is different for each person. Plan availability varies by county; in some areas, New Mexico residents only have two Medicare Advantage plans from which to choose, while other counties have up to 23 plans available. But in most counties in New Mexico, Medicare Advantage plan options are in the single digits.
Nationwide, and in New Mexico, about a third of all Medicare beneficiaries were enrolled in Medicare Advantage plans as of 2017. As of December 2018, there were 143,812 New Mexico Medicare beneficiaries with private coverage. That’s nearly 35 percent of the state’s Medicare population, and mirrors the uptick in Medicare Advantage enrollment nationwide. The other 65 percent of New Mexico’s Medicare beneficiaries had Original Medicare as of the end of 2018.
Medicare’s annual election period (October 15 to December 7 each year) allows Medicare beneficiaries the chance to switch between Medicare Advantage and Original Medicare (and add, drop, or switch to a different Medicare Part D prescription plan). Starting in 2019, people who are already enrolled in Medicare Advantage also have the option to switch to a different Advantage plan or to Original Medicare during the Medicare Advantage open enrollment period, which runs from January 1 to March 31.
Medigap in New Mexico
Original Medicare does not limit out-of-pocket costs, so most enrollees maintain some form of supplemental coverage. Nationwide, more than half of Original Medicare beneficiaries get their supplemental coverage through an employer-sponsored plan or Medicaid. But for those who don’t, Medigap plans (also known as Medicare supplement plans, or MedSupp) will pay some or all of the out-of-pocket costs they would otherwise have to pay if they had only Original Medicare.
Although Medigap plans are sold by private insurers, the plans are standardized under federal rules, with ten different plan designs (differentiated by letters, A through N). The benefits offered by a particular plan (Plan A, Plan M, etc.) are the same regardless of which insurer sells the plan.
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 New Mexico Medicare beneficiaries are under age 65. Federal rules do not guarantee access to Medigap plans for people who are under 65. Although the majority of the states have taken action to ensure access to Medigap coverage for disabled enrollees, New Mexico is not among them. The New Mexico Office of the Superintendent of Insurance confirmed that Medigap insurers in the state are not required to offer coverage to applicants under the age of 65. Insurers can do so voluntarily, but we did not find any Medigap filings in SERFF with rates for people under age 65.
But New Mexico is one of several states where pre-ACA high-risk pools remain operational, with coverage available to supplement Medicare if the enrollee is unable to obtain Medigap coverage. Information about New Mexico Medical Insurance Pool’s Medicare carve-out plan is available here. Standard premiums for this plan range from $185 to $762 in 2019, depending on the enrollee’s age. But the state has a subsidy program for people with income up to 400 percent of the poverty level, resulting in lower net premiums for people with low or modest incomes.
New Mexico is one of several states where private Medigap insurers are not required to offer plans to people under age 65, but state high-risk pool coverage provides a back-up option. The others are Alaska, Iowa, Nebraska, North Dakota, South Carolina, Washington, and Wyoming.
Disabled Medicare beneficiaries have access to the normal Medigap open enrollment period when they turn 65. At that point, they can enroll in a Medigap plan with the normal premiums that apply to people who are enrolling in Medicare due to age, rather than disability.
Disabled Medicare beneficiaries have the option to enroll in a Medicare Advantage plan instead of Original Medicare, as long as they don’t have kidney failure. Medicare Advantage plans are otherwise available to anyone who is eligible for Medicare, and the premiums are not higher for those under 65. But as noted above, Advantage plans have more limited provider networks than Original Medicare, and total out-of-pocket costs can be as high as $6,700 per year for in-network care, plus the out-of-pocket cost of prescription drugs.
Although the Affordable Care Act eliminated pre-existing condition exclusions in most of the private health insurance market, those rules 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 (although not all of them choose to do so). 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 Medigap insurer can consider your medical history in determining whether to accept your application, and at what premium.
Medicare Part D in New Mexico
Original Medicare does not provide coverage for outpatient prescription drugs. More than half of Original Medicare beneficiaries nationwide 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 beneficiaries who do not have drug coverage through Medicaid or an employer-sponsored plan need Medicare Part D in order to have coverage for prescriptions. Part D can be purchased as a stand-alone plan, or integrated with a Medicare Advantage plan. Part D was created under the Medicare Modernization Act of 2003, which was signed into law by President George W. Bush.
There are 27 stand-alone Part D plans for sale in New Mexico in 2019, with premiums that range from about $15 to $126/month.
A total of 297,217 New Mexico Medicare beneficiaries had Part D coverage as of December 2018. That included 160,080 with stand-alone Part D coverage, and 137,137 with Part D coverage integrated with Medicare Advantage.
Medicare spending in New Mexico
Original Medicare’s average per-beneficiary spending in New Mexico was 19 percent lower than the national average in 2017, at $7,954; only seven states had lower average per-beneficiary Original Medicare spending. The spending amounts are 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 stood at $9,761 in 2017.
You can read more about Medicare in New Mexico in our state Medicare guide. You can also contact the New Mexico State Health Insurance Assistance Program with questions related to Medicare coverage in the state.
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.