Philip J. Kavesh
Nationally recognized attorney helping clients with customized estate planning guidance for over 33 years.
California Estate Planning Attorney Kavesh Minor & Otis

After reassuring seniors that Medicare is not part of the new health insurance marketplaces, administration officials have a warning for anyone who may have other ideas: selling marketplace coverage to people who have Medicare is illegal.

Healthcare is confusing. For elderly on Medicare, a new law will make sure they are not sold unnecessary “marketplace” coverage. You may want to alert your elderly loved ones to beware.

Kaiser Health News recently addressed this concern in an article titled “Selling Marketplace Plans To Medicare Beneficiaries Will Be Illegal.

Problem: Medicare Part A is free for most beneficiaries and goes toward hospitalization and limited nursing home care. Since this fulfills the insurance requirements set by law, those on Medicare do not need anything in addition. For some 20-odd years it has been illegal for private insurers to try and sell their plans to individuals known to be Medicare recipients. This is the result of an effort to keep insurers from taking advantage of Medicare recipients.

Of course, Medicare recipients are not prevented from purchasing marketplace coverage, which is part of the difficulty.

The Medicare enrollment period starts next month and runs from October 15 to December 7. Coincidentally, the first healthcare marketplaces (the “exchanges”) will also start selling online next month with the requirement for such plans to become effective as of the beginning of 2014.

Seniors need to know the difference between Medicare “enrollment” and marketplace purchasing. Unfortunately, the timing of the two is not helping matters.

Bottom line: Medicare recipients should not buy on the marketplace what they get by enrollment all because of a mix-up. Hopefully, the legal penalties will scare off those insurance sellers who might try to confuse seniors.

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