Medicare in Tennessee

The Volunteer State requires insurers to offer guaranteed-issue Medigap plans to disabled beneficiaries under 65.

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  • January 21, 2019

Medicare in Tennessee: Key takeaways

Medicare enrollment in Tennessee

As of late 2018, there were 1,326,033 Tennessee residents with Medicare coverage. That’s a little more than 19 percent of the state’s total population, which is roughly comparable to the more than 18 percent of the United States population enrolled in Medicare.

In terms of total enrollment, Alaska had the fewest recipients at 97,195 (the only state with under 100,000 Medicare beneficiaries) and California (which has about an eighth of the country’s population within its borders) had the most, with more than 6.1 million (15 percent of its population).

Read about Medicare’s open enrollment period and other important enrollment deadlines.

Breakdown of the aged vs. disabled

Individuals who qualify by virtue of their age alone make up 80 percent of Tennessee Medicare recipients. The other 20 percent have Medicare coverage as the result of a disability.

KentuckyAlabama, and Mississippi are tied for having the highest percentage (23 percent) of their Medicare beneficiaries eligible due to a disability. Hawaii has the smallest percentage at 9 percent (if we include the US territories, American Samoa has the highest percentage of disabled Medicare beneficiaries, at 31 percent, and the Virgin Islands are tied with Hawaii, at 9 percent, with the lowest percentage of Medicare benficiaries eligible due to a disability.

Medicare spending per recipient in Tennessee

In 2016, Original Medicare spent an average of $9,749 per beneficiary in Tennessee, based on data that were standardized to eliminate regional differences in payment rates. For perspective, the national average that year was $9,533 per enrollee, so Medicare spending in Tennessee was about 2 percent higher than the national average.

In terms of average spending per recipient, three states had average Medicare costs that exceeded $11,000: Louisiana, Texas, and Florida (Louisiana was highest, at $11,399 per beneficiary in 20160. On the other end of the spectrum, Original Medicare costs per beneficiary were lowest in Hawaii, at $6,441.

Medigap in Tennessee

Although Original Medicare provides fairly comprehensive coverage, it can leave enrollees with substantial out-of-pocket costs if they don’t have supplemental coverage, and there is no cap on how high those out-of-pocket costs can be. Medigap plans are used to supplement Original Medicare, covering some or all of the out-of-pocket costs (for coinsurance and deductibles) that people would otherwise incur if they only had Original Medicare on its own.

Medigap plans are standardized under federal rules, and federal rules also provide a six-month window (which starts when the person turns 65 and is enrolled in Medicare Part B) during which coverage is guaranteed issue for Medigap plans. But there is no federal rule that guarantees access to Medigap coverage for people who are under 65 and eligible for Medicare as a result of a disability.

But more than half of the states have implemented rules to ensure that people under age 65 have at least some access to Medigap plans. Since 2011, under Tennessee law, Medigap insurers that offer plans to people age 65 and older are required to offer all of the same plans to people under 65 who become eligible for Medicare as a result of a disability. This is especially important in a state like Tennessee, where a higher-than-average percentage of Medicare beneficiaries are eligible as a result of a disability.

So in Tennessee, it doesn’t matter whether you become eligible for Medicare as a result of turning 65 or becoming disabled. In both cases, your six-month guaranteed-issue window for Medigap coverage begins once you enroll in Medicare Part B. Tennessee residents who are under age 65 can be charged higher premiums for their Medigap coverage, but only to the extent that the higher rates are actuarially justified.

Medicare Advantage in Tennessee

Medicare Advantage offers Americans health benefits through private plans instead of through Original — or traditional — Medicare (the federal government’s fee-for-service program). These often offer additional benefits beyond what Original Medicare offers, and some Medicare Advantage plans are available with no premiums other than the cost of Medicare Part B. (Enrollees still pay for Part B, in addition to the premium for the Medicare Advantage plan they buy). But there are pros and cons to both Medicare Advantage and Original Medicare with supplemental coverage.

36 percent of Tennessee Medicare beneficiaries were enrolled in Medicare Advantage plans in 2017, which was similar to the 33 percent of all Medicare beneficiaries nationwide who were enrolled in Medicare Advantage plans. The other 64 percent of Tennessee’s Medicare beneficiaries had coverage under Original Medicare.

The availability of Medicare Advantage plans varies from one county to another, but residents throughout Tennessee have access to a wide range of Medicare Advantage plans. Plan availability ranges from 15 plans in Lake County to 37 plans in Davidson County.

Minnesota is the only state where more than half (56 percent) of Medicare eligibles enrolled in a Medicare Advantage plan. In Alaska, just 1 percent of Medicare beneficiaries have Advantage coverage, and those people are enrolled in employer-sponsored Medicare Advantage plans (offered by an employer as an option for retirees), as there are no Medicare Advantage plans available to individual enrollees in Alaska.

Stand-alone Medicare Prescription Drug plans

More than half a million Medicare beneficiaries in Tennessee (about 39 percent of the state’s Medicare population) were enrolled in stand-alone Part D prescription drug plans as of late 2018.

There are 29 stand-alone Part D plans available in Tennessee in 2019, with premiums ranging from $16 to $120 per month.

Medicare prescription drug coverage — called Medicare Part D — was the result of legislation passed in 2003 and signed into law by President George W. Bush in 2006. The program was created because Original Medicare doesn’t cover prescription drug costs. Medicare beneficiaries can get Part D coverage on its own (as a stand-alone Part D plan) or integrated with a Medicare Advantage plan. In addition to the more than half a million people who have stand-alone Part D plans in Tennessee, nearly as many (482,105) have Part D coverage as part of their Medicare Advantage plan.

Health insurance in Tennessee if you’re not eligible for Medicare

Are you under 65 years of age or otherwise ineligible for Medicare? We have information on Tennessee health insurance and the Tennessee health insurance marketplace at our health insurance site.

Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.