Federal

Close the Medigap Act of 2023

Source: Congress.gov · 3,165 words in original text

What This Bill Does

This bill changes the rules for Medicare supplemental health insurance policies, also called Medigap policies. These are insurance plans that help pay for costs Medicare does not cover. The bill makes it illegal for insurance companies to deny Medigap coverage or charge more based on a person's health status or medical history. ##

Who It Affects

People who are entitled to Medicare Part A benefits or enrolled in Medicare Part B will be directly affected by this bill. Insurance companies that sell Medigap policies must follow the new rules. Insurance brokers and agents will have to report payments they receive from insurance companies. ##

Key Provisions

* Insurance companies cannot deny a Medigap policy, refuse to issue it, or charge more money based on health status, claims history, health care received, or medical condition (Sec. 2(a)) * Insurance companies cannot exclude benefits because someone had a health condition before getting the policy, and cannot create waiting periods for any benefits (Sec. 2(a)) * Insurance companies cannot charge different prices based on genetic information or use genetic information to make decisions about issuing policies (Sec. 2(a)) * Insurance companies cannot charge different prices based on a person's age (Sec. 4(a)) * Insurance companies must report annually to the government about payments made to insurance agents, brokers, and other third parties who sell their policies (Sec. 7) ##

What Changes

If this bill becomes law, insurance companies must accept anyone who applies for a Medigap policy, regardless of their medical history or health condition. They also cannot use age to set different prices for different people. Before this bill, insurance companies in some states could deny coverage based on preexisting conditions or charge sick people more money. The government will improve its Medicare plan comparison website to show people more information about Medigap policies, including premium costs, differences between policies, and which insurance companies are financially stable. Insurance companies must require that at least a higher percentage of premium money they collect goes toward paying for actual patient care, instead of other company expenses, starting in 2024. ##

Important Definitions

* **Medicare supplemental policy (Medigap):** Insurance coverage that pays for health care costs that Medicare does not pay for * **Preexisting condition:** A health problem someone had before getting a new insurance policy * **Medical loss ratio:** The percentage of insurance premiums spent on actual medical care versus company expenses * **Genetic information:** Information about a person's genes or family medical history ##

Effective Date

The main changes take effect on January 1, 2024 (Sec. 2(c)(1)). The Secretary of Health and Human Services can gradually implement the changes over up to 5 years, but must fully implement them by January 1, 2029 (Sec. 2(c)(2)).

I 118TH CONGRESS 1ST SESSION H. R. 35 To amend title XVIII of the Social Security Act to provide for certain reforms with respect to medicare supplemental health insurance policies. IN THE HOUSE OF REPRESENTATIVES JANUARY 9, 2023 Mr. DOGGETT (for himself, Mr. BISHOP of Georgia, Mr. BLUMENAUER, Mr. BOWMAN, Mr. CARTWRIGHT, Mr. CASAR, Mr. CASTEN, Ms. CHU, Mr. CLEAVER, Mr. COHEN, Ms. DELAURO, Mrs. DINGELL, Mr. EVANS, Mr. GARAMENDI, Mr. GARCI´A of Illinois, Mr. GRIJALVA, Mrs. HAYES, Ms. JAYAPAL, Ms. KAPTUR, Mr. KHANNA, Ms. LEE of California, Mr. MFUME, Mr. NADLER, Ms. NORTON, Ms. OCASIO-CORTEZ, Ms. PORTER, Ms. SCHAKOWSKY, Mr. SHERMAN, Mr. TAKANO, Mr. THOMPSON of Cali- fornia, Ms. TITUS, Mr. TONKO, Mr. TRONE, Mrs. WATSON COLEMAN, and Ms. WILLIAMS of Georgia) introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committee on Energy and Commerce, for a period to be subsequently de- termined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To amend title XVIII of the Social Security Act to provide for certain reforms with respect to medicare supple- mental health insurance policies. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 VerDate Sep 11 2014 03:49 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 35 IH SECTION 1. SHORT TITLE. 1 This Act may be cited as the ‘‘Close the Medigap Act 2 of 2023’’. 3 SEC. 2. GUARANTEED ISSUE. 4 (a) IN GENERAL.—Section 1882(s) of the Social Se- 5 curity Act (42 U.S.C. 1395ss(s)) is amended to read as 6 follows: 7 ‘‘(s)(1) Subject to paragraph (2), the issuer of a 8 medicare supplemental policy may not, in the case of an 9 individual entitled to benefits under part A and enrolled 10 under part B— 11 ‘‘(A) deny or condition the issuance or effective- 12 ness of a medicare supplemental policy, or discrimi- 13 nate in the pricing of the policy, because of health 14 status, claims experience, receipt of health care, or 15 medical condition; 16 ‘‘(B) exclude benefits based on a preexisting 17 condition; 18 ‘‘(C) provide any time period applicable to pre- 19 existing conditions, waiting periods, elimination peri- 20 ods, and probationary periods for any benefit; 21 ‘‘(D) deny or condition the issuance or effec- 22 tiveness of the policy (including the imposition of 23 any exclusion of benefits under the policy based on 24 a preexisting condition) or discriminate in the pric- 25 ing of the policy (including the adjustment of pre- 26 VerDate Sep 11 2014 03:49 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 35 IH mium rates) of an individual on the basis of the ge- 1 netic information with respect to such individual; 2 ‘‘(E) deny or condition the issuance or effective- 3 ness of a medicare supplemental policy that is of- 4 fered and is available for issuance to new enrollees 5 by such issuer; or 6 ‘‘(F) establish any period limiting enrollment 7 under a medicare supplemental policy to such period 8 for any individual. 9 ‘‘(2) Paragraph (1) shall not apply to an individual 10 entitled to benefits under part A solely by reason of section 11 226A. 12 ‘‘(3) Nothing in this subsection or in subparagraph 13 (A) or (B) of subsection (x)(2) shall be construed to limit 14 the ability of an issuer of a medicare supplemental policy 15 from, to the extent otherwise permitted under this title— 16 ‘‘(A) denying or conditioning the issuance or ef- 17 fectiveness of the policy or increasing the premium 18 for an employer based on the manifestation of a dis- 19 ease or disorder of an individual who is covered 20 under the policy; or 21 ‘‘(B) increasing the premium for any policy 22 issued to an individual based on the manifestation of 23 a disease or disorder of an individual who is covered 24 under the policy (in such case, the manifestation of 25 VerDate Sep 11 2014 22:20 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 35 IH a disease or disorder in one individual cannot also 1 be used as genetic information about other group 2 members.’’. 3 (b) OUTREACH PLAN.— 4 (1) IN GENERAL.—The Secretary of Health and 5 Human Services shall develop an outreach plan to 6 notify individuals entitled to benefits under part A 7 or enrolled under part B of title XVIII of the Social 8 Security Act (42 U.S.C. 1395 et seq.) of the effects 9 of the amendment made by subsection (a). 10 (2) CONSULTATION.—In implementing the out- 11 reach plan developed under paragraph (1), the Sec- 12 retary shall consult with consumer advocates, bro- 13 kers, insurers, the National Association of Insurance 14 Commissioners, and State Health Insurance Assist- 15 ance Programs. 16 (c) EFFECTIVE DATE; PHASE-IN AUTHORITY.— 17 (1) EFFECTIVE DATE.—Subject to paragraph 18 (2), the amendment made by subsection (a) shall 19 apply to medicare supplemental policies effective on 20 or after January 1, 2024. 21 (2) PHASE-IN AUTHORITY.— 22 (A) IN GENERAL.—Subject to subpara- 23 graph (B), the Secretary of Health and Human 24 Services may phase in the implementation of 25 VerDate Sep 11 2014 03:49 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 35 IH the amendment made under subsection (a) 1 (with such phase-in beginning on or after Janu- 2 ary 1, 2024) in such manner as the Secretary 3 determines appropriate in order to minimize 4 any adverse impact on individuals enrolled 5 under a medicare supplemental policy. 6 (B) PHASE-IN PERIOD MAY NOT EXCEED 5 7 YEARS.—The Secretary of Health and Human 8 Services shall ensure that the amendment made 9 by subsection (a) is fully implemented by not 10 later than January 1, 2029. 11 SEC. 3. MEDICAL LOSS RATIO. 12 Section 1882(r)(1)(A) of the Social Security Act (42 13 U.S.C. 1395ss(r)(1)(A)) is amended— 14 (1) by inserting ‘‘and periodically reviewed’’ 15 after ‘‘developed’’; and 16 (2) by striking ‘‘policy, at least 75 percent of 17 the aggregate amount of premiums collected in the 18 case of group policies and at least 65 percent in the 19 case of individual policies; and’’ and inserting the 20 following: ‘‘policy— 21 ‘‘(i) with respect to periods beginning be- 22 fore January 1, 2024, at least 75 percent of the 23 aggregate amount of premiums collected in the 24 VerDate Sep 11 2014 03:49 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 6 •HR 35 IH case of group policies and at least 65 percent 1 in the case of individual policies; and 2 ‘‘(ii) with respect to periods beginning on 3 or after January 1, 2024, a percent of the ag- 4 gregate amount of premiums collected that, in 5 the case of group policies or individual policies, 6 as applicable, is equal to or greater than both— 7 ‘‘(I) the applicable percent specified in 8 clause (i) with respect to such policies; and 9 ‘‘(II) such percent as the National As- 10 sociation of Insurance Commissioners may 11 recommend to the Secretary with respect 12 to such policies for purposes of this para- 13 graph; and’’. 14 SEC. 4. LIMITATIONS ON PRICING DISCRIMINATION. 15 (a) IN GENERAL.—Section 1882 of the Social Secu- 16 rity Act (42 U.S.C. 1395ss), as amended by section 6, is 17 further amended by adding at the end the following new 18 subsection: 19 ‘‘(aa) DEVELOPMENT OF NEW STANDARDS RELAT- 20 ING TO PRICING DISCRIMINATION.— 21 ‘‘(1) IN GENERAL.—The Secretary shall request 22 the National Association of Insurance Commis- 23 sioners to review and revise the standards for all 24 benefit packages under subsection (p)(1), including 25 VerDate Sep 11 2014 03:49 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 7 •HR 35 IH the core benefit package, in order to provide cov- 1 erage consistent with paragraph (2). Such revisions 2 shall be made consistent with the rules applicable 3 under subsection (p)(1)(E) (with the reference to the 4 ‘1991 NAIC Model Regulation’ deemed a reference 5 to the NAIC Model Regulation as most recently up- 6 dated by the National Association of Insurance 7 Commissioners to reflect previous changes in law 8 and the reference to ‘date of enactment of this sub- 9 section’ deemed a reference to the date of enactment 10 of this subsection). 11 ‘‘(2) CHANGES IN COST-SHARING DESCRIBED.— 12 Under the revised standards, coverage shall not be 13 available under a Medicare supplemental insurance 14 policy unless the issuer of the policy, in addition to 15 conforming to the other applicable requirements of 16 this section— 17 ‘‘(A) does not discriminate in the pricing 18 of the policy because of the age of the indi- 19 vidual to whom the policy is issued; 20 ‘‘(B) does not, to an extent that jeopard- 21 izes the access to such policy for individuals 22 who are eligible to participate in the program 23 under this title because the individuals are indi- 24 viduals described in paragraph (2) or (3) of sec- 25 VerDate Sep 11 2014 03:49 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 8 •HR 35 IH tion 1811, discriminate in the pricing of the 1 policy because the individual to whom the policy 2 is issued is so eligible to participate in such 3 program because the individual is an individual 4 so described in such a paragraph; and 5 ‘‘(C) does not establish premiums applica- 6 ble under such policy on a basis that would 7 apply to a portion of, but not the entirety of, 8 a county or equivalent area specified by the 9 Secretary. 10 ‘‘(3) APPLICATION DATE.—The revised stand- 11 ards shall apply to benefit packages sold, issued, or 12 renewed under this section to individuals who first 13 become entitled to benefits under part A or first en- 14 rolls in part B on or after January 1, 2024.’’. 15 (b) CONFORMING AMENDMENT.—Section 1882(o)(1) 16 of such Act (42 U.S.C. 1395ss(o)(1)) is amended by strik- 17 ing ‘‘, and (y)’’ and inserting ‘‘(y), and (aa)’’. 18 SEC. 5. CLARIFYING BENEFICIARY OPTIONS ON THE MEDI- 19 CARE PLAN FINDER WEBSITE. 20 Section 1804 of the Social Security Act (42 U.S.C. 21 1395b–2) is amended by adding at the end the following 22 new subsections: 23 ‘‘(d) In the case that the Secretary provides for a 24 Medicare plan finder internet website of the Centers for 25 VerDate Sep 11 2014 03:49 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 9 •HR 35 IH Medicare & Medicaid Services (or a successor website), the 1 Secretary shall, with respect to such website and in ac- 2 cordance with subsection (f)— 3 ‘‘(1) make available on such website— 4 ‘‘(A) access to provider networks in order 5 to provide to individuals entitled to benefits 6 under part A or enrolled under part B informa- 7 tion to assist such individuals in understanding 8 the restrictions on providers and potential costs 9 entailed by their decisions regarding enrollment 10 under parts A and B, under part C, and in 11 medicare supplemental policies under section 12 1882; 13 ‘‘(B) a review of out-of-pocket expendi- 14 tures, including deductibles, copayments, coin- 15 surance, monthly premiums, and estimated an- 16 nual out-of-pocket costs, displayed overall and 17 by components, based on the best available in- 18 formation as determined by the Secretary; and 19 ‘‘(C) during the period prior to January 1, 20 2024, information regarding the rules that, in 21 each State, pertain to guaranteed issue of medi- 22 care supplemental health insurance policies 23 prior to implementation of the provisions of the 24 Close the Medigap Act of 2023 and, in the case 25 VerDate Sep 11 2014 03:49 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 10 •HR 35 IH that a State has no such rules pertaining to 1 guaranteed issue of such policies, clear lan- 2 guage explaining the implications of such lack 3 of rules for individuals with pre-existing condi- 4 tions; 5 ‘‘(2) not later than January 1, 2024, and peri- 6 odically thereafter, perform a review of such website 7 in order to ensure that such website makes available 8 to individuals entitled to benefits under part A or 9 enrolled under part B the information that the Sec- 10 retary determines is necessary for such individuals 11 to make informed choices regarding their options 12 under the program under this title; and 13 ‘‘(3) not later than 12 months after the last 14 day of each period for the request for information 15 under subsection (e), update such website, taking 16 into consideration the information collected pursuant 17 to such subsection, to clarify the presentation of con- 18 sumer options for medicare supplemental health in- 19 surance policy options, including by presenting such 20 information in a manner calculated to be understood 21 by the average consumer and in a manner that— 22 ‘‘(A) improves consumer access to informa- 23 tion regarding the applicable premiums under 24 VerDate Sep 11 2014 03:49 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 11 •HR 35 IH such policy options as of the date on which such 1 website is so updated; 2 ‘‘(B) facilitates consumers’ ability to com- 3 pare and sort policy options and premium infor- 4 mation across plan offerings in a given location; 5 ‘‘(C) clarifies and explains differences in 6 policy value; 7 ‘‘(D) rates and explains the financial sta- 8 bility of issuers of such policies; 9 ‘‘(E) provides data on the inflation rate of 10 different policies; 11 ‘‘(F) provides information regarding the 12 guaranteed issue requirements that apply to 13 medicare supplemental health insurance policies 14 under section 1882(s)(3); and 15 ‘‘(G) includes such general information as 16 is determined by the Secretary to be necessary 17 for individuals entitled to benefits under part A 18 or enrolled under part B to understand costs 19 under MA plans available pursuant to part C 20 and prescription drug plans available pursuant 21 to part D. 22 ‘‘(e) Not later than 6 months after the date of the 23 enactment of this subsection and beginning on December 24 7 of each year thereafter, the Secretary of Health and 25 VerDate Sep 11 2014 03:49 Jan 12, 2023 Jkt 039200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H35.IH H35 kjohnson on DSK79L0C42PROD with BILLS 12 •HR 35 IH Human Services [Text truncated for display. Full text available on Congress.gov.]

Important: This plain English summary was generated by AI and is provided for informational purposes only. It is not legal advice. Always consult the official bill text on Congress.gov or a qualified attorney for legal matters.