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Section 9: Denitions
Guaranteed renewable policy—An insurance
policy that can’t be terminated by the insurance
company unless you make untrue statements to
the insurance company, commit fraud, or don’t pay
your premiums. All Medigap policies issued since
1992 are guaranteed renewable.
Medicaid—A joint federal and state program that
helps with medical costs for some people with
limited income and (in some cases) resources.
Medicaid programs vary from state to state, but
most health care costs are covered if you qualify
for both Medicare and Medicaid.
Medical underwriting—e process that an
insurance company uses to decide, based on
your medical history, whether to take your
application for insurance, whether to add a
waiting period for pre‑existing conditions (if
your state law allows it), and how much to
charge you for that insurance.
Medicare Advantage Plan (Part C)—A type
of Medicare health plan oered by a private
company that contracts with Medicare. Medicare
Advantage Plans provide all of your Part A and
Part B benets, with a few exclusions, for example,
certain aspects of clinical trials which are covered
by Original Medicare even though you’re still
in the plan. Medicare Advantage Plans include:
Health Maintenance Organizations, Preferred
Provider Organizations, Private Fee‑for‑Service
Plans, Special Needs Plans, and Medicare Medical
Savings Account Plans. If you’re enrolled in a
Medicare Advantage Plan, most Medicare services
are covered through the plan and aren’t paid for
by Original Medicare. Most Medicare Advantage
Plans oer prescription drug coverage.
Medicare-approved amount—e payment
amount that Original Medicare sets for a covered
service or item. When your provider accepts
assignment, Medicare pays its share and you pay
your share of that amount.
Medicare drug plan (Part D)—Part D adds
prescription drug coverage to Original Medicare,
some Medicare Cost Plans, some Medicare
Private‑Fee‑for‑Service Plans, and Medicare
Medical Savings Account Plans. These plans are
offered by insurance companies and other private
companies approved by Medicare. Medicare
Advantage Plans may also offer prescription drug
coverage that follows the same rules as Medicare
drug plans.
Medicare SELECT—A type of Medigap policy
that may require you to use hospitals and, in
some cases, doctors within its network to be
eligible for full benets.
Medigap Open Enrollment Period—A
one‑time‑only, 6‑month period when federal law
allows you to buy any Medigap policy you want
that’s sold in your state. It starts in the rst month
that you’re covered under Medicare Part B, and
you’re 65 or older. During this period, you can’t be
denied a Medigap policy or charged more due to
past or present health problems. Some states may
have additional Open Enrollment rights under
state law.
Premium—e periodic payment to Medicare, an
insurance company, or a health care plan for health
care or prescription drug coverage.
State Health Insurance Assistance Program
(SHIP)—A state program that gets money from
the federal government to give free local health
insurance counseling to people with Medicare.
State Insurance Department—A state agency
that regulates insurance and can provide
information about Medigap policies and other
private health insurance.