Why New York Is One of the Best States for Medicare Beneficiaries
5.12.2025
When it comes to Medicare, not all states are created equal. New York stands out as one of the most consumer-friendly states, offering benefits that don’t exist elsewhere. New York is a “guaranteed issue” state, meaning it doesn’t require medical underwriting to enroll in a Medicare Supplement plan. This gives New York Medicare beneficiaries unparalleled flexibility, allowing them to change insurance plans easily at any time. New York also has high income limits for financial assistance programs and state-sponsored benefits. Programs such as the Elderly Pharmaceutical Coverage allow New Yorkers to save significantly on Medicare-related costs.Lawyers who serve elderly and special needs populations often have clients who are eligible for Medicare. Understanding the basics of Medicare, how the program works in New York and the various cost-saving initiatives will be valuable in attracting and retaining clients by showing your deep knowledge of the services available to them at this stage of life.
Understanding Medicare Basics
Medicare is a federal health insurance program primarily for individuals turning 65, as well as those under 65 who qualify due to Social Security Disability Insurance. While other circumstances may grant eligibility, these are the most common. Medicare consists of two main components: Part A, which covers hospital-related services and skilled nursing facilities, and Part B, which covers doctor visits and outpatient medical care.
Unlike Parts A and B, which are administered by the federal government, Medicare Part D prescription drug plans are managed by private insurance companies. To enroll in a Part D plan, a beneficiary must have at least Medicare Part A; having Part B is not required.
For individuals who receive Medicaid in New York before becoming eligible for Medicare, enrollment in a benchmark Medicare Part D plan happens automatically through a private insurer. This ensures that Medicaid recipients transitioning to Medicare do not lose prescription drug coverage.
One of the most common misconceptions about Medicare is that it is free. While Medicare Part A is premium-free for individuals (or their spouses) who have worked and paid Medicare taxes for at least 40 quarters (10 years), Medicare Part B requires a monthly premium. In 2025, the standard Medicare Part B premium is $185 per month. However, higher income beneficiaries pay more due to the Income-Related Monthly Adjustment Amount. Social Security determines your Medicare Part B premium based on your modified adjusted gross income as reported on your IRS tax return from two years ago.
For example,
- For individuals who earned less than $106,000 in 2023 (or $212,000 for joint filers), in 2025 they will pay the standard $185 per month.
- For those who earned over $500,000 in 2023 as an individual, or $750,000 as a couple, in 2025 they will pay $628.90 per month for Part B, plus an extra $85.80 per month on top of their Medicare Part D premium.
Many beneficiaries who take no medications and do not want a Part D plan are surprised to learn that failing to enroll in a Medicare Part D prescription drug plan when first eligible results in a lifelong penalty. The penalty is 1% of the national average premium for each month without Part D or creditable coverage and remains for as long as the beneficiary is enrolled in Medicare Part D.
No Medical Underwriting: A Game-Changer for New Yorkers
One of the most important aspects of Medicare that beneficiaries should understand is the impact of medical underwriting. In almost every other state, medical underwriting is required to obtain a Medicare Supplement (Medigap) plan. This means that beneficiaries must pass a health evaluation to qualify, and in many cases, they can be denied coverage.
Medical underwriting is a process used by insurance companies to evaluate an applicant’s health history. Individuals can be denied coverage or face higher premiums if they have been recently hospitalized, diagnosed or treated for serious conditions, or advised by a doctor that they need an upcoming medical procedure. In most states, switching from a Medicare Advantage plan to a Medigap plan requires answering health-related questions, and failing underwriting could result in being denied coverage. Outside of New York, the best time to purchase a Medigap plan is during the Medigap Open Enrollment Period, which begins when an individual first becomes eligible for Medicare, either by turning 65 or enrolling in Part B. During this period, insurance companies cannot deny coverage or charge higher premiums based on health history.
New York, however, does not allow medical underwriting. This means that any applicant, regardless of their health history or preexisting conditions, is guaranteed acceptance into a Medicare Supplement plan at any time. This policy ensures that individuals who develop health conditions later in life still have access to comprehensive coverage without fear of being denied.
Unlike in most states, where individuals must carefully time their plan changes to avoid being locked out of Medigap coverage, New Yorkers have the flexibility to adapt their Medicare coverage as their health care needs change. Many beneficiaries choose to enroll in a Medicare Advantage plan when they are healthy and then switch to a Medigap plan later if they require more comprehensive coverage.
While applicants cannot be denied coverage, insurance companies in New York may impose a waiting period for preexisting conditions if the individual has gone without prior coverage before enrolling in a Medigap plan.
This consumer-friendly approach benefits Medicare beneficiaries, but it has also created challenges for insurance companies in New York. Since they must accept all applicants regardless of health status, many insurers have found it difficult to sustain the financial burden. As a result, some insurance companies have stopped selling Medicare Supplement plans in New York altogether, increased premiums significantly or made the enrollment process more complicated.
Optimal Time To Switch to a Medicare Supplement Plan in New York
Timing is crucial when switching to a Medicare Supplement plan, as it must align with the ability to leave a Medicare Advantage plan. There are two main time frames when this can be done.
The annual enrollment period, from Oct. 15 to Dec. 7, allows individuals to switch from a Medicare Advantage plan to a Medicare Supplement plan, with the new plan taking effect on Jan. 1. Additionally, the Medicare Advantage Open Enrollment period, from Jan. 1 to March 31, provides another opportunity to drop a Medicare Advantage plan and enroll in a Medicare Supplement plan, with the new coverage starting on the first day of the following month. In New York, no specific reason is required to make this switch – beneficiaries simply need to act within these designated periods.
Another critical factor to consider is prescription drug coverage. Because most Medicare Advantage plans include drug coverage, switching from a Medicare Advantage plan to either a new Medicare Advantage plan or a standalone prescription drug plan will automatically cancel the previous Medicare Advantage plan. However, Medicare Supplement plans do not include drug coverage. If a beneficiary switches from a Medicare Advantage plan to a Supplement plan but does not enroll in a standalone Part D prescription drug plan, their Medicare Advantage plan will remain active, making the Supplement plan ineffective. To avoid this, beneficiaries must ensure their Medicare Advantage plan is properly canceled when transitioning to a Supplement plan.
Special Enrollment Opportunities in New York
Special enrollment periods provide Medicare beneficiaries with the ability to make changes outside of standard enrollment windows. In New York, these periods offer an even greater advantage due to the state’s no medical underwriting rule. One of the most important special enrollment periods applies to individuals who are institutionalized in specific health care facilities.
Medicare Part A covers inpatient hospital care, including semi-private hospital rooms, meals and nursing care. However, to qualify for skilled nursing facility coverage under Medicare, beneficiaries must have been hospitalized as an inpatient for at least three consecutive days, not counting the discharge day. Additionally, the skilled nursing facility stay must be directly related to the condition for which the patient was hospitalized. Medicare covers skilled nursing facility stays as follows:
- Days 1–20: Medicare covers 100% of costs with no coinsurance.
- Days 21–100: Beneficiaries are responsible for a daily amount of $209.50 for each day, which can be covered by a Medicare Supplement plan.
If a Medicare beneficiary moves into, resides in or moves out of a skilled nursing facility, nursing home, intermediate care facility, rehabilitation hospital or long-term care hospital with an expected stay of at least 90 days, they qualify for an institutionalized special enrollment period. This period begins on the first day of institutionalization and ends two months after discharge. During this period, individuals can enroll in a Medicare Advantage plan, drop it and switch to a Medicare Supplement plan in New York without medical underwriting.
This special enrollment period is particularly advantageous for Medicare beneficiaries in New York, as it provides a level of flexibility that is not available in most other states. Many institutionalized facilities actively encourage patients to transition away from Medicare Advantage plans in favor of traditional Medicare with a Supplement plan. This is because Medicare Advantage plans often require beneficiaries to pay daily copayments for their stay and place restrictions on the length of time they can remain in a facility. By switching to traditional Medicare with a Supplement plan, beneficiaries gain more freedom, and their coverage is often more comprehensive. Not only does this allow patients to stay in facilities longer and receive the care they need, but it also ensures that facilities are properly compensated for the services they provide.
How Medicare and Medicaid Work Together in New York
Medicare serves as the primary payer, covering hospital care under Part A and medical services under Part B. Medicaid acts as the secondary payer, covering Medicare deductibles, coinsurance and copayments. In many cases, Medicaid also helps cover services that Medicare does not provide, such as long-term care. However, Medicaid programs vary by state, and while some states may use different names, all have programs designed to assist low-income individuals.
Individuals who qualify for both Medicare and Medicaid are known as dual eligibles. These beneficiaries also have the option to enroll in dual-eligible special needs plans, which are Medicare Advantage plans specifically designed for those who qualify for both programs. These plans are heavily marketed because they allow insurance companies to generate revenue while also helping clients coordinate their benefits.
Dual-eligible special needs plans integrate Medicare and Medicaid services, streamlining care management, improving coordination and reducing administrative burdens for beneficiaries. Many dual-eligible individuals face challenges related to housing instability, food insecurity and transportation issues, and these plans often provide additional support services to address these needs.
To attract enrollees, insurance companies offer extra benefits beyond traditional Medicare, including dental, vision and hearing coverage, transportation services and over-the-counter benefit cards that can be used for food, health products and personal care items. Prescription drug coverage is also included, often reducing medication costs to minimal amounts.
Medicare Savings Programs in New York
Medicare savings programs are state-administered programs that assist low-income individuals in paying their Medicare premiums. New York has some of the most lenient program qualifications in the country, making them accessible to a larger population. In 2023, the state expanded the Medicare-savings program income eligibility from 135% to 186% of the federal poverty level, making an estimated 300,000 additional New Yorkers eligible for assistance.
When an individual qualifies for a Medicare savings program, they automatically receive Extra Help, a federal program that reduces Medicare Part D prescription drug costs. The New York State Department of Health has designated local departments of social services as the primary administrators of savings program benefits.
New York offers two primary Medicare savings program categories:
- Qualified Individual: Income limit of $2,426 (single) or $3,279 (couple).
- Qualified Medicare Beneficiary: Income limit of $1,800 (single) or $2,433 (couple).
Unlike many other states, New York does not impose an asset limit for Medicare savings program eligibility – qualification is strictly based on gross monthly income. Gross Social Security income is counted before the Part B premium deduction, and other health insurance premiums, such as Medigap or dental plans, can be deducted from income.
Key benefits of the program include:
- Paying the Medicare Part B premium, saving beneficiaries $2,220 annually.
- Automatic qualification for Part D Extra Help.
- Elimination of the Part B late enrollment penalty.
- Allowing Part B enrollment outside of standard periods.
- The Qualified Medicare Beneficiary category also covers the Part A premium for individuals who do not have enough work history for free Part A.
The Elderly Pharmaceutical Insurance Coverage Program
Elderly Pharmaceutical Insurance Coverage is a New York State-specific prescription assistance program that supplements Medicare Part D costs for income-eligible seniors aged 65 and older. Unlike many other states, New York allows seniors to apply for it at any time during the year, provided they are enrolled in a Medicare Part D drug plan. The application process has some of the highest income thresholds in the country for a state pharmaceutical assistance program, making it easier for New Yorkers to qualify.
Elderly Pharmaceutical Insurance Coverage offers two plan options:
- Fee Plan: Available for individuals earning up to $20,000 (single) or $26,000 (married).
- Deductible Plan: Available for individuals earning up to $75,000 (single) or $100,000 (married).
It does not replace Medicare Part D but instead helps cover the cost of prescriptions by reducing out-of-pocket expenses on a sliding scale. Beneficiaries receive a card that must be presented alongside their Part D plan when filling prescriptions.
Enrollment in the program provides an additional election period per year to switch a Medicare Advantage or Part D plan. The new plan takes effect the month following the application’s receipt. If an individual loses their eligibility, they qualify for another special enrollment period, which begins the month of notification and ends two months later.
Inflation Reduction Act: Key Medicare Changes in 2025 and the $2,000 Cap on Drug Costs
One of the most significant policy changes impacting Medicare beneficiaries is the Inflation Reduction Act. This legislation introduced several key reforms aimed at reducing out-of-pocket prescription drug costs under Medicare Part D.
In 2024, cost-sharing in the catastrophic phase of Part D was eliminated, meaning beneficiaries no longer have to pay out-of-pocket once they reach this stage.
In 2025, a new $2,000 annual out-of-pocket cap for Medicare Part D beneficiaries takes effect. This cap is a major relief for those with high prescription drug costs, as it ensures that once a beneficiary spends $2,000 on covered medications, they will not have to pay anything further out of pocket for the rest of the year. However, this cap does not apply to drugs that are not covered under a Part D plan, medications covered under Part B (such as infused drugs administered in an outpatient setting) or monthly premiums.
While this reform benefits those with high prescription drug expenses, it has also had unintended consequences. Many insurance companies have increased Part D plan premiums to compensate for the new cap, and some have consolidated or eliminated plans entirely. As a result, many beneficiaries – especially those who take few or no medications – have questioned why they are required to enroll in a Part D plan when they may see little immediate benefit.
New York’s Unique Medicare Benefits: Maximizing Coverage and Savings
New York’s consumer-friendly policies, including its no medical underwriting rule, lenient Medicare savings program qualifications and the Elderly Pharmaceutical Coverage program, make it one of the most advantageous states for Medicare beneficiaries.
The ability to switch Medicare Supplement plans at any time without medical underwriting ensures that individuals can adjust their coverage as their health care needs change, even with preexisting conditions. The state’s Medicare savings programs offer premium assistance with some of the highest income limits in the country, making coverage more affordable for many. The Elderly Pharmaceutical Insurance program provides additional prescription drug cost relief for middle income seniors while allowing for an extra plan switch each year. Skilled nursing facilities often favor Medigap plans over Medicare Advantage, as they allow for longer covered stays with fewer restrictions.
Additionally, the Inflation Reduction Act introduces a $2,000 cap on Medicare Part D drug costs, which provides significant savings for beneficiaries with high prescription expenses. However, the law has also contributed to higher premiums for some plans.
Medicare is a very complex, confusing topic. Seniors that are 65 or older or approaching Medicare eligibility are likely uneducated on their options and overwhelmed by the noise and information available to them. Lawyers who serve these clients have the opportunity to share critical information and reiterate that beneficiaries in New York State, in particular, have unparalleled access to great coverage, with a variety of ways to reduce associated costs.
Britt Burner is a partner at Burner Prudenti Law. She is chair of the Elder Law and Special Needs Section.
Brian Krantz is a Medicare advisor with over 15 years of experience helping individuals navigate the complexities of Medicare. Based in New York and licensed in all 50 states, Brian specializes in Medicare Supplement (Medigap), Medicare Advantage and prescription drug plans.
This article appears in the Elder and Special Needs Law Journal, the publication of the Elder Law and Special Needs Section. For more information, please visit NYSBA.ORG/ELDER.
