At a glance: Medicare health insurance in Washington
- More than 1.3 million people in Washington are enrolled in Medicare.
- Nearly a third of Washington’s Medicare beneficiaries have Medicare Advantage plans. But in nine of the state’s 39 counties, there are no Advantage plans available in 2019.
- In Washington, 25 insurers offer Medigap plans but only two offer plans to people under age 65.
- Washington’s pre-ACA high-risk pool serves as a safety net for people unable to qualify for Medigap plans and who don’t have access to Medicare Advantage.
- But Washington has implemented numerous Medigap consumer protections, including community rating, continuous guaranteed-issue right to switch to a different Medigap plan, and a limitation on pre-existing condition waiting periods.
- There are 26 stand-alone Part D prescription plans available in Washington in 2019, with premiums that range from about $15 to $117 per month. About 865,000 Washington Medicare beneficiaries have Part D coverage, either as stand-alone plans or integrated with Medicare Advantage plans.
- Per-enrollee Original Medicare spending in Washington is among the lowest in the nation.
Medicare enrollment in Washington
As of December 2018, there were 1,333,810 Washington residents enrolled in Medicare. That’s a little more than 17 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 Medicare eligibility is also triggered for younger people if they’re disabled and have been receiving disability benefits for 24 months, or have ALS or end-stage renal disease. Nationwide, 16 percent of Medicare beneficiaries are under the age of 65. In Washington, only 14 percent of Medicare beneficiaries are eligible due to disability rather than age.
Medicare Advantage in Washington
Private Medicare Advantage plans are an alternative to Original Medicare, and are available in most areas of the country. But in Washington, Medicare Advantage plans are only available in 30 of the state’s 39 counties. In the other nine counties, Medicare beneficiaries must be enrolled in Original Medicare. In the 30 counties where Medicare Advantage plans are for sale, plan availability ranges from just one plan in Whitman County, to 43 plans in King County.
Thirty percent of Washington’s Medicare beneficiaries had Advantage plans as of 2017, versus a nationwide average of 33 percent. As of December 2018, 434,185 Washington residents had private Medicare coverage, which amounted to about 32.5 percent of the state’s Medicare population. Nationwide, Medicare Advantage enrollment has been steadily increasing for more than a decade.
Original Medicare coverage is provided directly by the federal government, and enrollees have access to a nationwide network of providers. But people with Original Medicare need supplemental coverage (from an employer-sponsored plan, Medicaid, or privately purchased plans) for things like prescription drugs and out-of-pocket costs (out-of-pocket costs are not capped under Original Medicare).
Medicare Advantage includes all of the benefits of Original Medicare, and the plans usually also have additional benefits, such as integrated Part D prescription drug coverage and coverage for things like dental and vision care. But Medicare Advantage insurers establish their own provider networks, which are generally localized and more limited than the nationwide network for Original Medicare. Out-of-pocket costs for Medicare Advantage are often higher than they would be if a beneficiary had Original Medicare plus a Medigap plan. There are pros and cons to either alternative, and no single solution that works for everyone.
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 Washington
Original Medicare does not limit out-of-pocket costs, so most enrollees maintain some form of supplemental coverage. 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) will pay some or all of the out-of-pocket costs they would otherwise have to pay if they had only Original Medicare (Medigap plans cannot be used with Medicare Advantage coverage). According to an AHIP analysis, there were 272,727 Washington residents with Medigap coverage as of 2016.
There are 25 insurers that offer Medigap plans in Washington as of 2019 (although Government Personnel Mutual will no longer sell new Medigap plans as of March 2019). Medigap plans are sold by private insurers, but 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 sells the plan. Pricing, however, varies from one insurer to another.
In addition to community-rating requirements, Washington state law also gives Medigap enrollees the option to switch to a different Medigap plan at any time, guaranteed-issue. Federal rules only grant a one-time six-month open enrollment period for Medigap; after that, unless a person experiences one of the limited circumstances that trigger a guaranteed-issue right, Medigap plans can be medically underwritten, unless states impose other rules. Washington is one of just a handful of states where state law prevents Medigap insurers from using medical underwriting if a person with Medigap wants to switch to a different policy after their initial enrollment window has ended. State law in Washington allows a person with Medigap Plan A to switch to any other Medigap Plan A. And a person with Medigap Plan B through N can switch to any other Plan B through N. This opportunity to switch plans on a guaranteed-issue basis applies year-round, as long as the person has been covered for at least 90 days.
Washington has also enacted legislation to limit pre-existing condition waiting periods for Medigap enrollees. 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 if you didn’t have continuous coverage prior to your enrollment. Federal rules allow Medigap insurers to impose pre-existing condition waiting periods of up to six months, but Washington law limits it to three months instead.
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 14 percent of Washington Medicare beneficiaries are under age 65. But federal rules do not guarantee access to Medigap plans for people who are under 65. The majority of the states have implemented rules to ensure that disabled Medicare beneficiaries have at least some access to Medigap plans. But although Washington has gone beyond federal regulations in terms of rating requirements and allowing Medigap enrollees to switch plans on a guaranteed-issue basis, the state does not require Medigap insurers to offer coverage to people under the age of 65 who are enrolled in Medicare due to a disability.
Only two of Washington’s Medigap insurers offer plans to people under the age of 65: United American (this is common for this insurer in other states as well; United Amerian is often one of the only insurers that offers plans to people under 65 when a state doesn’t require insurers to do so), and the Washington State Health Care Authority plan.
United American offers only Medigap Plan B for people under 65. The premium in 2019 is $424/month, versus the $217/month that United American charges for Plan B if the enrollee is 65 or older. The Washington State Health Care Authority plan is administered by Premera Blue Cross, and Plan F is available to enrollees under age 65. If they are a retired state employee, the rates are lower ($199/month), but the plan is available for any Washington resident under age 65 who is eligible for Medicare due to disability. In 2019, the price is $361.03 for a person who isn’t a retired state employee. For perspective, a retired state employee only has to pay about $112/month for the Washington State Health Care Authority Plan F if they’re 65+. A person who is 65+ and not a retired state employee would pay about $212/month. Plan F won’t be available for new enrollees to purchase anywhere in the country after the end of 2019. Premera Blue Cross confirmed that they are working on a transition, and will be offering a different plan as of 2020 for new enrollees.
Disabled Medicare beneficiaries can choose instead to enroll in a Medicare Advantage plan, 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.
But Washington has also maintained their pre-ACA high-risk pool (WSHIP, the Washington State Health Insurance Pool), and it serves as an option for disabled Medicare beneficiaries (WSHIP’s non-Medicare plans have been closed to new enrollees since 2014, as the ACA eliminated the need for a high-risk pool in the non-Medicare market). WSHIP’s Basic Plan to supplement Medicare is available to people who are unable to obtain Medigap plans due to medical underwriting, and who live in an area where they don’t have “a reasonable choice of Medicare Advantage plans,” or who have end-stage renal disease (since Medicare Advantage plans can decline applicants with ESRD).
As noted above, there are nine counties in Washington where there are no Medicare Advantage plans available at all. And there are several counties with three or fewer Medicare Advantage plans for sale. Washington’s approach is that people who are unable to qualify for a Medigap plan can rely on Medicare Advantage if it’s available, but if it’s not, WSHIP is an option that allows Medicare beneficiaries to have supplemental coverage on a guaranteed-issue basis. WSHIP’s Medicare supplement plan is $430/month in 2019 for beneficiaries under 65, and $342 for those age 65+ (a person who missed their initial enrollment period for Medigap and tried to enroll at a later time, without a guaranteed-issue right, could be declined by the insurer; WSHIP then becomes an option).
Several other states — Alaska, Iowa, Nebraska, New Mexico, North Dakota, South Carolina, and Wyoming — have also maintained their high-risk pools and use them to provide supplemental coverage to Medicare beneficiaries who are unable to obtain private Medigap coverage.
Disabled Medicare beneficiaries have access to the normal Medigap open enrollment period when they turn 65. At that point, they can select from among any of the available Medigap plans, at the standard community-rated premiums that apply to people who are 65 or older.
Medicare Part D in Washington
Original Medicare does not provide coverage for 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 beneficiaries who do not have drug coverage through Medicaid or an employer-sponsored plan need to obtain Medicare Part D in order to have coverage for prescriptions. Part D can be purchased as a stand-alone plan, or as part of a Medicare Advantage plan with integrated Part D prescription drug coverage.
There are 26 stand-alone Part D plans for sale in Washington in 2019, with premiums that range from about $15 to $117/month.
As of late 2018, there were 480,067 Washington Medicare beneficiaries who had stand-alone Part D plans. Another 384,867 had Part D prescription coverage integrated with their Medicare Advantage plans.
Medicare spending in Washington
Original Medicare’s average per-beneficiary spending in Washington was well below the national average in 2016, at $7,898. That figure is 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. Only six states had average per-beneficiary spending lower than Washington’s.
Medicare spending in Louisiana was the highest in the nation, at $11,399, which was 20 percent higher than the national average. At the other end of the spectrum, per-beneficiary Medicare spending was lowest in Hawaii, at just $6,441.
You can read more about Medicare in Washington in our state Medicare guide. You can also contact SHIBA, the Washington Statewide Health Insurance Benefits Advisors, with questions related to Medicare coverage in Washington.
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.