At a glance: Medicare health insurance in New Mexico
- More than 430,000 New Mexico residents are enrolled in Medicare — more than 20 percent of the state’s population.
- Nearly 40 percent of New Mexico Medicare beneficiaries are enrolled in Medicare Advantage plans
- Medicare Advantage availability in New Mexico ranges from three to 27 plans, depending on the county.
- At least 39 insurers offer Medigap plans in New Mexico; the state does not require Medigap insurers to offer coverage to people under age 65, but two insurers do so voluntarily, and high-risk pool coverage is also available for Medicare beneficiaries under age 65.
- There are 26 stand-alone Part D prescription plans available in New Mexico in 2019, with premiums that range from about $13 to $123 per month. About 73 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.
There were 430,047 residents enrolled in Medicare in New Mexico as of June 2020, which amounts to more than 20 percent of the state’s population.
For most Americans, Medicare enrollment goes along with turning 65. 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 New Mexico, it was 16 percent.
- Read our guide to Medicare’s open enrollment.
- Understand the difference between Medigap, Medicare Advantage, and Medicare Part D.
Original Medicare in New Mexico
Original Medicare, which includes Medicare Part A and Medicare Part B, is the same in every state. So overall Medicare eligibility in Michigan and Medicare enrollment in Michigan both work the same way they do everywhere else. For people who aren’t yet receiving Social Security benefits and thus aren’t automatically enrolled when they turn 65, the Medicare application in Michigan 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.
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 three Medicare Advantage plans from which to choose in 2020, while other counties have up to 27 plans available.
Nationwide, and in New Mexico, about a third of all Medicare beneficiaries were enrolled in Medicare Advantage plans as of 2018. By mid-2020, there were 170,028 New Mexico Medicare beneficiaries with private coverage. That’s nearly 40 percent of the state’s Medicare population, and mirrors the uptick in Medicare Advantage enrollment nationwide. The other 60 percent of New Mexico’s Medicare beneficiaries had Original Medicare as of 2020.
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). 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 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.
According to an AHIP analysis, there were 67,447 New Mexico Medicare beneficiaries with Medigap coverage as of 2018. The New Mexico Office of the Superintendent of Insurance used to maintain a page that listed the state’s Medigap insurers, but they removed it in 2019 as it was outdated. They confirmed that they do not currently maintain a listing of Medigap insurers in the state, although filing data is available on SERFF. But Medicare’s Medigap plan finder tool shows all of the insurers that offer Medigap plans; there are 39 separate insurers offering Medigap plans in New Mexico as of 2020.
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; 16 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. But insurers can do so voluntarily, and at least two do so as of 2020 — Blue Cross Blue Shield of New Mexico, and United American Insurance Company.
New Mexico is also 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 $166 to $685 in 2020, 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 (note that as of 2021, beneficiaries with kidney failure will be able to enroll in Medicare Advantage plans). Medicare Advantage plans are otherwise available to anyone who is eligible for Medicare, and the premiums are not higher for those under 65. But Medicare 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.
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, albeit with a late enrollment penalty if they didn’t have creditable coverage prior to enrolling.
There are 26 stand-alone Medicare Part D plans for sale in New Mexico in 2020, with premiums that range from about $13 to $123/month.
A total of 315,215 New Mexico Medicare beneficiaries had Part D coverage as of June 2020. That included 153,796 with stand-alone Medicare Part D plans, and 161,419 with Part D coverage integrated with Medicare Advantage.
Medicare spending in New Mexico
Original Medicare’s average per-beneficiary spending in New Mexico was 20 percent lower than the national average in 2018, at $8,112; 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 $10,096 in 2018.
You can also contact the New Mexico State Health Insurance Assistance Program with questions related to Medicare eligibility in New Mexico and Medicare enrollment in New Mexico.
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.