Transamerica, a large insurance company that has recently entered into the Medicare supplement insurance marketplace, is making a significant change to its reimbursement policy for new enrollees.
The insurance company recently released an official statement saying it will be implementing a new “pre-existing condition” clause. The new clause will no longer pay for health care expenses that stem from any health complications from a pre-existing condition until six months (three months in the state of Washington) after the effective date of the insurance policy. Six months is the longest period that federal laws will allow a supplemental insurance carrier to refuse payment for pre-existing conditions.
According to the statement from Transamerica, a “pre-existing condition” is defined as “a condition or illness diagnosed or treated before new health care coverage begins,” meaning it could be anything from kidney disease to arthritis. Pre-existing conditions will not be covered for the first six months, but all other conditions will be covered.
There are a few exemptions from this new clause. The new rule will only apply to new applicants that do not have adequate health insurance coverage at the time they apply for the supplemental policy. Meaning that anyone with sufficient healthcare coverage when they apply will be exempt from this rule and will receive typical coverage from the effective date.
The Transamerica statement also emphasized that existing customers will see no change in their coverage. Any current client will experience no change in their premiums or copays, and no applicant will be subject to these changes as long as they apply for supplemental insurance before February 19th.
Medicare supplemental insurance provides much-needed coverage for many Medicare enrollees. With original Medicare parts A and B, there are several portions of needed healthcare or medical expenses that are not covered, which strains Medicare participants’ budgets. These Medicare supplements are carried by private insurers and cover expenses like premiums, copayments, and coinsurance payments.
For many people, Medicare supplemental insurance is the best way to save money on Medical bills and health care costs throughout their retirement. While Medicare covers a large portion of common procedures and visits, there are still monthly premiums, copays, and treatments that are not covered that can quickly drain a retirement nest egg. Around 20 percent of all Medicare participants purchase an additional supplemental insurance policy.
For Medicare enrollees looking for additional coverage, supplemental insurance is an excellent option, but consumers should be cautious of the fine print. Jason Patterson, an insurance agent and co-founder of MedicareWallet.com stresses the importance of carefully reading insurance policies before purchasing one, “Many people don’t read the fine print. You could end up with health care you have to have, but coverage that doesn’t pay for it”. Thoroughly understanding the clauses of policies will ensure you are not left with extensive medical bills.
Transamerica is based in Cedar Rapids, Iowa and was founded in 1928. The company specializes in financial services and insurance policies, but they have only offered individual Medicare supplemental plans for three years, beginning in 2013. Transamerica has received excellent reviews from several different rating companies such as A.M. Best where Transamerica has been given an A+ review.
Transamerica is not the first insurance company to implement this type of clause into their insurance policies; many businesses have created these kinds of ordinances to keep their costs low. As more American’s reach 65, Medicare supplemental insurance will gain popularity. Understanding clauses like Transamerica is necessary to ensure that they get the coverage they are looking for.
