- Group Medicare Advantage plans are also called employer group waiver plans (EGWP), pronounced “egg-whips.”
- EGWPs are a type of Medicare Advantage plan offered by some employers to employees and retirees of some companies, unions, or government agencies.
- EGWPs may offer more benefits than traditional Medicare Advantage plans.
- EGWPs are often PPOs.
If you are retired or planning to retire soon, a Group Medicare Advantage Plan may be one of your insurance options. These Group Medicare Advantage plans are also called employer group waiver plans (EGWP), which insurance experts call “egg-whip.”
Many employers offer them to their retired or retiring employees. These Advantage plans may offer extra benefits to you as well as more relaxed enrollment guidelines.
Keep reading to find out more about EGWPs, benefits they may offer you (and your family), and things to know before you sign up for one.
Group Medicare Advantage plans are insurance plans offered by employers or unions to their retirees. EGWPs are provided by private insurance companies who manage your company’s retiree Medicare benefits.
Under EGWPs, Medicare pays the insurance company a fixed amount to provide benefits. The employer also typically pays the insurance company an additional amount to offer extra benefits.
Group Medicare Advantage plans may offer services to their members that go beyond traditional Medicare Advantage plans. Some examples include:
- lower out-of-pocket costs
- health education
- extra benefits
Medicare grants special waivers to insurance companies and their Group Medicare Advantage plans. These waivers apply to enrollment periods, premiums, and service areas all of which benefit you as a retiree.
Most EGWPs, nearly 76 percent, are local preferred provider organizations (PPOs). A PPO is a type of insurance in which you pay the lowest fees if you use preferred providers or in-network doctors, hospitals, and other healthcare providers. You can still use out-of-network providers, but you will have to pay more.
Medicare requires all EGWPs to offer the same services as traditional Medicare Advantage.
Here are the parts of Medicare that EGWPs cover:
- Part A: Medicare Part A insurance is the portion that pays for hospital costs, such as inpatient hospital care or rehabilitation facility care related to illness or injury.
- Part B: Medicare Part B is the Medicare portion that pays for doctor visits and related medical costs, including emergency care when you are not admitted.
- Part D: Medicare Part D is the prescription drug coverage portion of Medicare. Most prescription drug coverage plans involve different “tiers” of medications where you may pay little to no costs for generic medications and a greater portion of costs for name-brand medicines.
EGWPs do not include Medicare Supplement insurance (also known as Medigap). You must be enrolled in traditional Medicare to purchase Medigap. Sometimes, an employer will offer you the option of enrolling in their EGWP or going with traditional Medicare and a Medigap plan.
EGWPs cover the same services as Medicare parts A, B, and D: hospitalization, doctor visits, prescription drugs, testing, and other healthcare. They may also offer other benefits, such as dental, eye exams, foot care, or wellness classes.
Sometimes, EGWPs also offer drug coverage for spouses or dependents who aren’t yet Medicare-eligible due to their age.
Businesses, unions, and state and local governments may offer EGWPs. Retirees and former employees of these groups who are eligible for Medicare may qualify for EGWPs if offered.
An employer or former employer will notify you if they offer Medicare benefits when you are 65 or if a doctor declares you disabled before this age.
You may be eligible for an employer sponsored Group Medicare Advantage plan if you are 65 or are receiving disability benefits.
Of the 20 million Americans who participate in Medicare Advantage plans, an estimated 4.1 million are in EGWPs, and the greatest number of EGWP enrollees are in Illinois, Michigan, Virginia, and West Virginia.
One of the benefits of an EGWP is the enrollment period. If you want to enroll in a typical Medicare Advantage plan, you can usually only do so at certain times during the year. Similarly, you can’t disenroll from these plans except during specific times. EGWP plans are different in that you can typically enroll and dis-enroll at any time during the year.
The average premium for Group Medicare Advantage will depend on how much an employer subsidizes the Medicare costs. In 2019, the average monthly Medicare Advantage premium overall was $29. Specific data on average Group Medicare Advantage premiums isn’t currently available.
Most EGWP plans are PPOs. In 2019, the average monthly premium for a regional PPO was $44 and a local PPO was $39.
While the premiums are low for monthly Medicare, you will usually have an out-of-pocket limit for other costs as well. The average out-of-pocket limit for PPOs in 2019 was $5,059 for in-network services and $8,818 for out-of-network services.
Other out-of-pocket costs may include:
- Copay: a fee you pay for healthcare services at the time of care. You may have a copay every time you see a doctor on your plan. This fee may be higher for specialists.
- Deductible: the amount you pay before your plan starts to cover your healthcare costs. This fee usually applies to services other than doctor visits.
- Coinsurance: Coinsurance is a percentage of the cost that you must pay for a medical service after your deductible has been met. Your EGWP will cover the rest of the cost for that service. For example, you may have to pay 20 percent for an X-ray, and your EGWP will pay the remaining 80 percent.
Your specific plan will determine if you must pay any of these fees and if so, how much.
If your company (or former company) offers you an EGWP, you may need to talk to the company’s insurance representative. Some things to consider about EGWPs include:
- Your insurance coverage needs. Be sure to consider the medications you take and doctors you see. This will enable you to see if the plan covers your prescriptions and providers.
- The geographic area the plan covers. Look for hospitals and healthcare practices included in the network. Look for an in-network hospital near you in case you require immediate care.
- The plan’s star rating. The Medicare Advantage Star Ratings program rates Medicare Advantage plans on a scale of up to five stars. Medicare Advantage considers plans that earn four or five stars to be high-quality.
- Other Medicare Advantage plan options. Compare the EGWP plan to other available Medicare Advantage plans in your area by visiting Medicare.gov/plan-compare. If you have a specific question, you can also call 1-800-MEDICARE.
Since insurance companies tailor EGWPs to each business, union, or government entity, you may be able to do most of your research through the insurance company that provides the plan and the benefits office at your company.
Group Medicare Advantage plans (also called EGWPs) can be an attractive benefit for you as an employee. Sometimes, joining your company’s EGWP means you can get extra benefits that traditional Medicare Advantage doesn’t offer, plus you don’t have to follow the same rules regarding enrollment periods.
Talk to your former employer to find out if they offer an EGWP. It could save you money in the long run, especially if your former employer pays for some of the plan costs.