“Are you a smoker or non-smoker?”
This is one of two questions that I need to ask a potential policyholder when underwriting them for a Medigap plan, also known as a supplement plan to Medicare. The other question I am required to ask, well not really ask but I need to document it on the application is whether the Medicare recipient is male or female.
The gender criteria will also determine your rate, but we will get back to the gender question a little later.
To be honest, I am very surprised at the number of people I ask the smoking question, and they reply they are either a non-smoker or gave up smoking years ago. It just goes to show you that education has come a long way since the 1970s when I was a kid.
I remember back then that almost every adult I came in contact with smoked tobacco in some form on a regular basis, including both my parents, so we’re making progress and that’s a good thing!
What is defined as tobacco use? “Any tobacco product, including cigarettes, cigars, chewing tobacco, snuff, and pipe tobacco, used four or more times a week within the past 12 months.”
Bottomline, if you are a smoker you will pay significantly more in premium than a non-smoker.
I don’t really see the reason to explain why this is, being we all know the answer to that, but I can tell you that 99% of all Medigap carriers will ask that question. I know of one or maybe two carriers that don’t but then you will pay a lot more in premium because those few carriers don’t take it into consideration.
Meaning if you are a healthy non-smoker you are paying more money for a supplement because the carrier is guarding against the future health of their smoker clients. So as a healthy non-smoker you are placed in the same class as a smoker, is that fair for a non-smoker?
Exception – Open Enrollment
Why even bother going there for your coverage? There is one loophole for smokers where they will not be asked the question, and that is if they are new to Medicare or turning 65 and considered to be in your “Open Enrollment” phase.
Smokers in this instance will be able to receive the same rate as a non-smoker counterpart.
I would also add that there are no increased rates for smokers if they opt for a Medicare Advantage plan.
It is very important as a Medicare recipient to report your tobacco use because if you are asked the question and lie and the insurance carrier does find out, you could be on the hook for fraud. Insurance carriers do look at your MIB report, especially if smoking related issues arise and claims are being produced.
What if you lie about your smoking use and the carrier agrees to accept you and now you are diagnosed with lung cancer due to tobacco use, the carrier can deny your insurance claims for that condition. The result? You could lose your coverage and most definitely be on the hook for all medical costs related to your tobacco use.
Reducing Your Rate If You’re a Smoker
Now, there is some good news for smokers who pay more. If you decide to quit smoking and stay clean from tobacco use for at least a year, most Medigap carriers will reduce your rate to a non-smoker rate if you can provide a note from your primary care physician.
Not only that, if you smoke and are ready to finally give it up but need assistance, Medicare will cover smoking-cessation counseling sessions. Medicare covers up to 8 sessions a year. For these Medicare covered sessions you will be assisted by a qualified counselor who will work with you one on one.
The coverage does depend on whether you have a health condition related or caused by your smoking history. If you have Medicare as your primary coverage and don’t have any smoking related conditions, Medicare will cover the cost of your anti-smoking sessions.
With regards to Advantage plans, you are covered for the counseling sessions if your doctor or other health care provider accepts “Assignment”.
Male or female, “why do I have to pay more if I’m a male? Isn’t that discriminatory?” Well, not really, let me explain.
In the first couple of years when I had started assisting seniors in choosing the right supplement coverage, I never fully understood why males were charged more premium and I never really put much thought into it because I never lost a client because of it.
But I always wondered why. I really didn’t like not being able to answer that question fully, so I called an underwriter from a top supplement insurance carrier. She explained to me the reason is that women tend to see their physicians on a regular basis and don’t miss their appointments.
She also added that when women are advised they should see a specialist for a condition they don’t hesitate and abide by their doctor’s advice. Her explanation at first didn’t make sense to me because in a natural way of thinking is that the Medigap carrier obviously covers and pays for a lot more visits, procedures, surgeries etc. and that males must be saving the carriers more money by not using their coverage as much as females do.
The underwriter then explained that when women see their physicians on a regular basis they stay healthier and ward off more expensive medical conditions by seeing their physician often, whereas a male usually does not see a physician until a medical condition becomes chronic and now needs regular attention that usually becomes more costly and requires a lot more attention.
There a couple of carriers who also don’t differentiate between male and female rates, but then again you usually pay more premium.
“How come you have to ask me all these medical questions, I thought under Obamacare I can’t be denied coverage?”
Remember folks, Medicare is not Obamacare and a Medigap plan is only a supplement to your Medicare.
Medicare is your primary insurance carrier so they can ask all the underwriting questions they desire because they are under no obligation to insure you.