New laws are bringing many changes to Medicare Supplement (Medigap) insurance plans and policies. Contrary to what many believe, these changes are NOT a result of the recently passed Healthcare Reform Bill. In fact, the changes DO come as a result of HR 6331, known as the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), which authorized implementation of the NAIC’s proposed Medigap modernization changes, approved by the NAIC Plenary in March of 2007.
Effective June 1, 2010, companies may offer two new Medicare supplement insurance plans and will stop selling five plans on June 1, 2010. Certain other plans will also have benefits added or deleted. The primary changes are as follows:
New Plans Offered:
- New Plan M – includes 50 percent coverage of the Medicare Part A deductible and does not cover the Medicare Part B Deductible. Plan M has all the core benefits plus the foreign Travel Emergency Benefit.
- New Plan N – does not cover the Medicare Part B deductible and adds a new co–payment structure of $20 for each physician visit and $50 for each emergency room visit (waived upon admission to the hospital). Plan N has all the core benefits plus the foreign Travel Emergency Benefit.
- Plans D and G bought on or after June 1, 2010 have different benefits than D or G plans bought before June 1, 2010. (Please note, if you bought Plan D or G before June 1, 2010, you can keep that plan and the benefits won’t change.)
- Plans E, H, I, J – will no longer be available for sale after June 1, 2010. However, any plan that was purchased prior to June 1, 2010 will remain in-force. If you currently have plans E, H, I, or J, you can keep your policy and continue to receive all benefits in your plan as long as you continue to pay premiums. You DO NOT have to buy a new policy.
- Plan G – Part B excess charge benefit will increase from 80 percent to 100 percent for plans sold on or after June 1, 2010
- At-Home Recovery – benefit will be dropped from all 2010 Medicare Supplement plans
- Preventative Care – benefit will be dropped from all 2010 Medicare Supplement plans
- New Hospice Benefit – All plans will now include the Hospice Benefit as part of the “Core Benefits.” Medicare pays for all but very limited co-payments for outpatient drugs ($5). Included in all Medigap plans a benefit to pay this co-payment will be included. Medicare provides coverage for inpatient respite care up to 5 days less a co-payment amount of 5% of the daily benefit. The new Hospice benefit will pick up this 5% co-pay.
- Part B Coinsurance – Plans K, L, and N will require you to pay a portion of Part B coinsurance and copayments, which may result in lower premiums for these plans. All other Medigap policies pay Part B coinsurance or copayments at 100%.