Medigap-guaranteed issue associated with Medicare Advantage disenrollment for beneficiaries administered a part B drug.

Abstract

While many Medicare beneficiaries are enrolling in Medicare Advantage (MA), some beneficiaries may want to return to traditional Medicare and purchase Medigap, especially beneficiaries who have greater medical needs. Beyond minimal federal regulations, states impose additional regulations that impact Medigap affordability. Beneficiaries in some states have greater difficulty obtaining Medigap coverage because the states where they live allow Medigap insurers to experience rate the beneficiary, which can make Medigap insurance prohibitively expensive. We examined beneficiaries who received physician-administered drugs, which can be expensive and subject to high cost sharing, to see if disenrollment from MA for these beneficiaries was greater in states with Medigap consumer protection policy levels. In 2020, we find a 1.0% average baseline average probability of MA disenrollment. For beneficiaries who received a physician-administered drug in our sample, the probability of MA disenrollment is 3.7 (95% CI, 2.6-4.8; P < .001) percentage points higher in Medigap-guaranteed issue states compared with states with no protections. We find a greater association between MA disenrollment and Medigap protection policies with higher cost drugs. These findings suggest that beneficiaries who receive a high-volume and high-spending physician-administered drug are more likely to disenroll from MA back to traditional Medicare when Medigap is more affordable.