The National Association of Insurance Commissioners has updated one of its model regulations to conform with the new federal Medicare prescription drug program law.[@@]
The changes will help states that adopt the model phase out the Medicare supplement, or “Medigap,” plans that now offer prescription drug benefits.
The NAIC model affected is the Model Regulation to Implement the NAIC Medicare Supplement Insurance Minimum Standards Model Act.
State insurance regulators, insurers, consumer advocates and actuaries began working with the staff of the Kansas City, Mo.-based NAIC on revisions to the Medigap model soon after President Bush signed the Medicare Prescription Drug, Improvement Modernization Act of 2003.
In general, states have a year to enact the model, NAIC officials say.
The model regulation does not apply to union health plans or retiree plans or to multi-employer health plans or retiree health plans.
The law that led to the changes, MPDIMA, is creating a new, voluntary Medicare program, Medicare Part D, that will offer Medicare beneficiaries subsidized prescription drug coverage. The authors of the act have tried to hold down beneficiaries’ drug spending by restricting and eliminating existing Medicare drug benefits options.
Today, in most states, Medigap sellers now pick the plan designs they offer from a menu of standard products designated by the letters A through J.
The Medigap plans that include outpatient prescription drug coverage go by the letters H, I and J.