Today we wanted to quickly discuss a common Prescription Drug Plan enrollment mistake.
We see this mistake happening all the time by agents out in the field and I want to make sure you know how to properly handle this situation with your client.
So today we are going to talk about the difference between the enrollment election options you have on that Part D application you’re filling out with your client…specifically ‘New to Medicare’ versus a ‘Special Enrollment Period’, commonly referred to as an SEP.
Here’s the scenario.
If you are speaking with a client and intending on enrolling them in a stand-alone PDP, the Part A Effective Date is going to be the crucial date to identify.
Yes, Part B is important, but their Part A Effective Date is going to dictate which election you choose on that application.
That’s because a client can enroll in Part D with only Part A in place. Part B is not a requirement for Part D.
The common mistake made out there is this –
usually if you are dealing with a client coming off of their group health and they are just getting their Part B. You would assume they are in their Initial Enrollment Period (or IEP) and choose the election option ‘I am new to Medicare’ and be done with it.
In most cases that would be correct, if they are just getting Part A in conjunction with Part B.
However, if that client has had Part A already in effect (for more than 4 months), then they are not ‘New to Medicare’, and that is not the appropriate election to make on their PDP application.
The proper election to make in that scenario is the ‘Special Election Period – SEP – LEC’. LEC standing for Leaving Employer Coverage. And the client has 63 days to enroll in that PDP after their group coverage ends, using that specific SEP.
I can’t tell you how many PDP applications I have seen rejected because of this very issue. And once the enrollment is resubmitted using SEP – LEC, they fly right through for approval with CMS without issues.
You may have already experienced this scenario or not, but it is good information to be conscious of, so you don’t have to deal with the hassle of rejected applications and having to submit an additional enrollment with your client. And doing things the right way the first time, will certainly bode well for your credibility.
So that’s it for today and I hope the discussion was helpful. If you have any questions on this topic, feel free to reach out to me or our knowledgeable staff to discuss further.
Appreciate your time and happy selling out there!