Number: RL31223
Title: Medicare: Supplementary "Medigap" Coverage
Authors: Jennifer O'Sullivan, Domestic Social Policy Division 
Abstract: The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA, P.L. 108-73) added a new voluntary prescription drug benefit under a new Medicare Part D. It also made a number of changes to the Medigap requirements. The first significant change was the addition of two new standardized plan types, Plan K and Plan L. There are two key differences between the benefits included under these options and those offered under Plans A-H. First, Plans K and L eliminate first-dollar coverage for most Medicare cost-sharing. Second, both Plans K and L include an annual out-of-pocket limit on Medicare cost-sharing charges. The second major MMA change was the prohibition, beginning January 1, 2006, on the sale of Medigap policies with prescription drug coverage. Individuals who had such policies could renew them provided they did not enroll in a prescription drug plan under the new Part D. Alternatively, if they enrolled under Part D, they could continue to enroll in a Medigap plan, but without drug coverage. MMA also required the Secretary of the Health and Human Services to request the National Association of Insurance Commissioners (NAIC) to review and revise the Medigap benefit packages, taking into account changes made by the new law. The NAIC announced its recommendations in March 2007. The Children's Health and Medicare Protection Act of 2007 (CHAMP), as passed by the House on August 1, 2007, incorporates these recommendations, as well as making additional Medigap changes.
Pages: 21
Date: October 2, 2007