If you’re selling Medicare Supplement in Idaho, be prepared for some significant changes to the market in 2022. Beginning March 1, Idaho will be implementing the “Birthday Rule” for all Medigap policyholders and will also require Community Rating of Med Supp carriers to determine plan pricing.
Below we explore how these changes affect brokers interacting with their Medigap clients. But first, let’s take a look at exactly what these new rules mean.
Idaho’s New Birthday Rule for Medicare Supplement
Idaho residents who are Med Supp policy holders will have a 63-day window every year starting on their birthday to enroll in a different Medigap policy without having to go through medical underwriting. This is a great opportunity for all Med Supp policy holders and will ensure even more parity in the Idaho market. Here are a couple of important details:
- The change must be to the same type of policy or one with lesser coverage. For instance, someone with a Plan A could not switch to a Plan G by using the Birthday Rule (see chart below).
- The Birthday Rule only applies to beneficiaries that already have a Med Supp policy. Someone without a policy, whose Open Enrollment Period has passed and doesn’t possess any other guarantee-issue rights, will have to go through medical underwriting.
Birthday Rule Options Chart
| Policy Holders of Medigap Plan… | Can replace it with Medigap Plan… |
| A | A |
| B | A or B |
| C | A, B, C, D, K, L, M, or N |
| D | A, B, D, K, L, M, or N |
| E | Any Plan |
| F | Any Plan |
| High Deductible F | High Deductible F or High Deductible G |
| G | Plan A, B, D, G, K, L, M, N, “HD” F, or “HD” G |
| High Deductible G | High Deductible G |
| H | A, B, D, K, L, M, or N |
| I | A, B, D, G, K, L, M, or N |
| J | Any Plan |
| High Deductible J | High Deductible F or High Deductible G |
| K | K |
| L | K or L |
| M | M or N |
| N | N |
Community Rating Going Into Effect
Premium rates for new Medicare Supplement policies will be based on “Community Rating” rather than the attained age of the applicant. This means that premiums are based on a single rate for all ages and classes within the group.
For instance:
If on March 1, 2022, 65-year-old Ms. Jones and 72-year-old Mr. Anderson both enroll in ABC Insurance Company’s Plan G Medigap policy, they will be paying the same premium.
Current holders of Issue-Age Rated Medigap policies will keep this rating unless they switch plans after February 28, 2022.
As has been the case in other states that have gone to Community Rating, policies for those that are younger (70 and under) will probably be higher than Issue-Age Rated policies. But Community Rated policies for older (over 70) beneficiaries may be less than Issue-Age Rated policies. This makes sense when you consider the average Issue-Age Rated Medigap policy will increase 2 to 3% annually.
What This Means For Brokers
If you want to maintain your Medicare Supplement book of business, it would be wise to start reaching out to your clients a month or two before their birthdays to let them know what options they have available. Because if you don’t, someone else will.
We all know how easy it is to obtain prospect birthday data. Rest assured that call centers and hungry agents will be contacting your clients to offer them a more affordable policy.
While it can be easy to become lazy with annual reviews, the Birthday Rule implementation will make them much more of a necessity.
Be the trusted source to inform your client if there is a better option available. For your older clients that still have an Issue-Age Rated policy, there may be a more affordable Community Rated option available. For your younger clients, you can give them the confidence that they are still on the most affordable option or you can provide them with something better.
In a nutshell, if you want to maintain your Idaho Med Supp book of business, reach out to every client at least a month prior to their birthday. Don’t leave any low hanging fruit for your competition.
So you want to grow your Medicare client base through MAPD and PDP education and enrollments. Well, you can’t call anyone, even if they’re referred to you. Can’t email anyone, unless they give you permission to. Direct response can be effective, but requires an investment to yield response rates of approximately 1%.
