Ask the Expert
Medicare Supplement Changes Abound
by Douglas Terwilliger
Medicare supplement insurance, sometimes called Medigap or MedSupp, is private insurance that helps cover some of the gaps in Medicare coverage. All Medicare supplement policies must cover certain expenses after Medicare is exhausted, including the daily coinsurance amount for hospital-ization and 90 percent of the hospital charges that otherwise would have been paid by Medicare. People who are 65 or older can buy Medicare supplement insurance without having to worry about being rejected for existing medical problems, so long as they apply within six months after enrolling in Medicare.
Over the past few years, Medicare has increased the number of standard Medicare supplement insurance policies from 10 (Plans A–J) to 12 (Plans A–L). The standardized policies make it easier to compare the costs of policies issued by different insurers. While all 12 standard policies may not be available to everyone, Plan A must be made available to Medicare recipients everywhere. (Note that in Massachusetts, Minnesota, and Wisconsin, Medicare supplement insurance policies are standardized in a different way.)
In response to Congressional report language included in the Medicare Prescription Drug, Improvement and Modernization Act of 2003, the NAIC (National Association of Insurance Commisioners) Senior Issues Task Force assembled a subgroup to work on the modernization of Medicare supplement insurance plans and benefits. The subgroup was comprised of state regulators, CMS (Centers for Medicare and Medicaid Services) representatives, consumer advocates, industry representatives, and other interested parties.
One stipulation was that existing policyholders were able to keep their old policies. The Task Force recommended the following changes:
- Eliminate Plans E, H, I, and J.
- Create new plans M and N that contain new options with higher beneficiary cost-sharing and lower anticipated premiums.
- Eliminate the outdated “At-Home Recovery” benefit.
- Create a new “Hospice” benefit, which is added to every plan as part of basic (core) benefits.
- Eliminate outdated and underutilized “Preventative Care” benefit.
- Replace the 80 percent Part B Excess Charges Benefit with 100 percent benefit.
These changes are set to take effect on June 1, 2010.
Over the past few years, Medicare has increased the number of standard Medicare supplement insurance policies from 10 to 12.
For more information about Medicare supplement insurance policies:
- Visit www.medicare.gov/Publications/ Pubs/pdf/02110.pdf to view the booklet, Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare.
- Call your State Insurance Department to get more information. Call 1-800-MEDICARE (1-800-633-4227) to get the telephone number. TTY users should call 1-877-486-2048.
To find and compare Medicare supplement insurance policies:
- Visit www.medicare.gov and select “Compare Medicare Health Plans and Medigap Policies in Your Area.”
- Call 1-800-MEDICARE.
- Call your State Health Insurance Assistance Program (SHIP).