AARP Supplemental Medicare Insurance – How Does it Work?

The American Association of Retired Persons (AARP) is a special-interest (non-government) group based in the U.S.  AARP focuses on issues related to people who are 50 years old or older. AARP services a vast membership of an estimated 33 million people. 

One of the special concerns of older Americans is health care, including Medicare and its recent changes.  To address that issue, the organization offers the AARP Medicare Supplement insurance to those members who wish to purchase it.

Medicare supplement insurance plans provide for access to any doctor nationwide who accepts Medicare.  There is no need to be limited to a doctor, location, or sometimes pharmacy by having to choose a primary care physician. 

Furthermore, Medicare supplement plans are said to offer greater benefit stability than Medicare itself, in addition to the greater access to facilities and doctors.

AARP's lobbying activities helped spur the U.S. Congress to pass the Medicare Prescription Drug, Improvement, and Modernization Act, which authorized the creation of Medicare Part D.  The 2006 Medicare Part D prescription plan options offer prescription drug coverage to Medicare members through private health insurance companies. 

The AARP Medicare Supplement insurance works like many other supplement plans.  For those AARP members enrolled in an AARP Medicare Supplement with drug coverage, there can be confusion about how the Medicare Part D prescription plan affects their supplement coverage.  AARP has identified some options for AARP Medicare Supplement members to follow.

The first option is for AARP Medicare Supplement insurance members with drug coverage to go ahead and sign up for the Medicare Part D prescription program.  Those members could then drop the drug coverage from their AARP Medicare Supplement insurance plan and rely on the Medicare drug coverage.

If the first option is not chosen, AARP Medicare Supplement members have Options 2 or 3.  For Option 2, the AARP Medicare Supplement member could enroll in the Medicare Part D plan, then adjust their AARP Medicare Supplement coverage to create an insurance package similar to their original AARP Medicare Supplement plan.  Persons considering this option should weigh the cost and prescription benefits carefully.

Option 3 suggests that AARP Medicare Supplement members simply keep their existing AARP plans and not enroll in the Medicare Part D prescription program.  However, the AARP warns that members choosing to join the Medicare Part D program at a later date may incur a penalty for late enrollment.

Those AARP Medicare Supplement insurance plan members who do not have the AARP drug coverage should simply enroll in the Medicare prescription plan as soon as possible (e.g., during the next open enrollment period).  The AARP Medicare Supplement insurance coverage of these people will not change.

Each AARP Medicare Supplement insurance program member should examine their financial and medical circumstances carefully before making a decision regarding the effect of Medicare Part D on their AARP Medicare Supplement plan.  The most up-to-date information can found at the AARPHealthcare.com website.

Filed under: Medicare Supplemental Insurances