Medicare in New York

New York's Medigap regulations are among the strongest in the country, with community rating and year-round guaranteed-issue plans

At a glance: Medicare health insurance in New York

How many New Yorkers have Medicare coverage?

2020 Medicare enrollment datesNearly 3.6 million people in New York had Medicare coverage as of late 2018. That’s just under 18 percent of the state’s population, compared with a little more than 18 percent of the United States population enrolled in Medicare.

In most cases, eligibility for Medicare is triggered by turning 65 years old. But people who have been receiving disability benefits for at least 24 months are also eligible for Medicare. In New York, 15 percent of Medicare beneficiaries are under 65 and eligible due to disability. That’s comparable to the 16 percent average nationwide.

Medicare Advantage in New York

Medicare beneficiaries can choose to receive their benefits directly from the federal government via Original Medicare — along with supplemental coverage for prescriptions and out-of-pocket costs — 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).

Original Medicare includes Medicare Parts A and B. Medicare Advantage includes all of the benefits of Medicare Parts A and B, and the plans generally include additional benefits, such as integrated Part D prescription drug coverage and extras like dental and vision. But Medicare Advantage enrollees are limited by the provider network for the plan they select, and total out-of-pocket costs are often higher than they would be under Original Medicare plus a Medigap plan. There are pros and cons to either option, and no single solution that works for everyone.

38 percent of Medicare beneficiaries in New York were enrolled in Medicare Advantage plans as of 2017, compared with an average of 33 percent nationwide. Most of the other 62 percent of the state’s Medicare beneficiaries were enrolled in Original Medicare, but some New York residents are enrolled in Medicare Cost plans.

New York has a robust Medicare Advantage market, with 2019 plan availability ranging from 18 plans in Livingston County to 92 plans in Kings County (Brooklyn).

During Medicare’s annual election period (October 15 to December 7 each year) beneficiaries have the opportunity to switch between Medicare Advantage and Original Medicare and/or add or drop a Medicare Part D prescription plan. And new as of 2019, Medicare Advantage enrollees 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 York

While Original Medicare provides fairly comprehensive coverage, it doesn’t cover everything (prescriptions are not covered) and it doesn’t have a cap on out-of-pocket costs. Under Medicare Part B, that amounts to an unlimited 20 percent coinsurance. To address the gaps in Original Medicare, most enrollees have some sort of supplemental coverage. More than half of Original Medicare beneficiaries get their supplement coverage through an employer-sponsored plan or Medicaid.

For those without access to either of those options, 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 (in order to have prescription coverage, it’s also necessary to buy a Medicare Part D plan, as Medigap plans sold since 2006 do not include prescription coverage).

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; not all insurers offer all plans for sale), 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 consumers can base their plan selection on premiums and less tangible things like customer service, since the benefits themselves are uniform.

There are 15 insurers licensed to offer Medigap plans in New York. 462,130 people had Medigap plans in New York as of 2016, according to an AHIP analysis.

New York has among the strongest Medigap consumer protections in the nation. As long as a person in New York is enrolled in Medicare Parts A and B, they can enroll in a Medigap plan at any time, year-round, and premiums do not vary based on the applicant’s age or health status. This is also true for enrollees who are under 65 and eligible for Medicare due to a disability. Premiums do vary from one insurer to another, and from one area to another (2019 premiums are available here; an insurer can only vary the price of a particular Medigap plan based on where the enrollee lives).

New York’s rules go far beyond the federal rules, and beyond the rules that most states have imposed on Medigap insurers (Connecticut is the only other state where Medigap is available year-round, without medical underwriting; a handful of other states offer windows each year when some or all plans are guaranteed-issue). Under federal rules, there is no annual open enrollment window for Medigap plans. Instead, federal rules provide only a one-time six-month window when Medigap coverage is guaranteed-issue, starting when the person is at least 65 and enrolled in Medicare Part B. And federal rules don’t guarantee access to Medigap plans at all for people who are under 65 and enrolled in Medicare due to a disability. New York’s rules are much more robust.

Because of the year-round availability, community rating, and lack of medical underwriting, premiums for Medigap enrollees in New York are generally higher than they are in most other states when enrollees are 65. But this Medigap premium chart from Alaska is a good example of how high Medigap premiums can be for older enrollees in states that allow Medigap insurers to increase premiums over time, as an enrollee ages (referred to as attained-age rating, as opposed to New York’s community rating). Although the rates are higher to start out in New York, older enrollees pay the same amount as younger enrollees.

New York also has fewer Medigap insurers than most high-population states with fewer Medigap regulations. For example, Arizona, which defaults to the federal rules for Medigap plans, has 62 insurers offering policies in 2019.

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, and New York allows Medigap insurers to conform to federal Medigap regulations for pre-existing conditions. Medigap insurers can impose a pre-existing condition waiting period of up to six months, if an applicant didn’t have at least six months of continuous coverage prior to enrolling. But beyond that, consumers are protected in New York. In most other states, people enrolling after their initial six-month open enrollment window can be denied coverage or charged higher premiums due to pre-existing conditions, and that’s not the case in New York.

Medicare Part D in New York

Original Medicare doesn’t cover for outpatient prescription drugs. More than half of Original Medicare enrollees have supplemental coverage obtained through 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 with integrated Part D prescription drug coverage.

In 2019, insurers in New York are offering 23 stand-alone Part D plans for sale, with premiums ranging from about $16 to $93 per month.

1,464,503 New Yorkers had stand-alone Part D plans as of late 2018, and another 1,325,477 had Part D coverage integrated with their Medicare Advantage plans.

Medicare spending in New York

Based on Original Medicare spending data that were standardized to eliminate regional differences in payment rates, average per-beneficiary costs for New York enrollees stood at $9,670 in 2016 (the analysis did not include costs for Medicare Advantage).

Nationwide, average per beneficiary Original Medicare spending was $9,533 per enrollee, so Medicare spending in New York was only slightly higher than the national average. Per-beneficiary Original Medicare spending was highest in Louisiana, at $11,399, and lowest in Hawaii, at just $6,441.

You can read more about Medicare in New York in our state Medicare guide. You can also contact HIICAP, New York’s Health Insurance Information Counseling and Assistance program, with questions related to Medicare coverage in New York.

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 Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.

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