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Can my Medicare Advantage Plan Drop Me?

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Summary: Medicare Advantage plans may discontinue your Medicare Advantage coverage if you don’t pay your premium within the grace period allowed by the Medicare Advantage plan. However, your plan cannot drop you because of your have health problems.

In most cases, Medicare Advantage plans automatically renew each year and will not drop you. Medicare Advantage plans are considered “guarantee issue”. This means that you can enroll in a Medicare Advantage plan so long as you have Medicare Part A (hospital insurance) and Part B (medical insurance). You also have to live in the Medicare Advantage plan’s service area and (in most cases) do not have End-Stage Renal Disease. Your health problems will not result in your Medicare Advantage plan dropping you. However, there are a few cases where your plan could be discontinued. 

Under what circumstances can Medicare Advantage plans drop your coverage?

Despite the fact that Medicare Advantage plans are usually guarantee issue and renewable, there are some situations which your Medicare Advantage plan could drop your coverage.

  1. CMS Contract Discontinued

Every year the private insurers that offer Medicare Advantage plans must undergo approval from the Centers for Medicare and Medicaid Services (CMS). It is possible that an insurance company may decide to discontinue offering a Medicare Advantage plan. If this happens, you would receive a letter from the insurer letting you know that your Medicare Advantage plan will be discontinued at the end of the year. You must then decide whether to enroll in another Medicare Advantage plan or go back to the federal government-administered Medicare Part A and Part B and enroll in a Medicare Part D Prescription Drug Plan, if desired.

  1. Service Area Reduction

During the re-approval process discussed above, Medicare Advantage plans may apply to CMS to reduce their service areas. If you no longer live in the Medicare Advantage plan service area, the Medicare Advantage plan cannot continue to provide you coverage. When this happens, you will receive notice from the insurer telling you of the change that will occur at the end of the year. You will then have to enroll in another Medicare Advantage plan or go back to Medicare Part A and Part B coverage for next year.

  1. Moving Outside the Service Area

You may move outside the service area of your Medicare Advantage plan. If this happens, the Medicare Advantage plan typically cannot continue to provide you coverage. You will be given the opportunity of a Special Enrollment Period to enroll in another Medicare Advantage plan where you relocated or return to Medicare Part A and Part B. You also may enroll in a stand-alone Medicare Part D Prescription Drug Plan to make up for losing your Medicare Advantage prescription drug coverage.

  1. Nonpayment

Medicare Advantage plans may discontinue your Medicare Advantage coverage if you don’t pay your premium within the grace period allowed by the Medicare Advantage plan. If you can’t make your premium payment, you should contact your Medicare Advantage plan’s customer service. Explain the situation, and see if a special arrangement can be made to pay the late premiums and for you to remain covered by the Medicare Advantage plan.

  1. Special Needs Plan Eligibility

Medicare Advantage plan called Special Needs Plans (SNP) are designed to meet the health care needs of Medicare beneficiaries who have special health needs.

To enroll in a particular SNP, you must meet the Medicare Advantage plan’s eligibility requirements, in addition to the general requirement for enrolling in a Medicare Advantage plan. You generally can stay enrolled in a SNP only if you continue to meet the special conditions served by the plan.

For example, if you enrolled in a SNP that covers Medicare beneficiaries who reside in nursing facilities, and you move out of a nursing facility and back home, you may lose eligibility for the plan. You will have a Special Enrollment Period to make another choice—perhaps to enroll in a general Medicare Advantage plan or to return to Medicare Part A and Part B

If you have End-Stage Renal Disease (ESRD) you may be able to stay in your Medicare Advantage plan.  Your plan also may have you enroll in another Medicare Advantage SNP plan offered by the same insurance company if one is available where you live.

Would you like more information about Medicare Advantage plans and coverage? You can also review the Medicare Advantage plans where you live and compare their coverage by entering your ZIP code on this page.

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