Medigap Consumer Protection Act of 2019

II 116TH CONGRESS 1ST SESSION S. 2428 To amend title XVIII of the Social Security Act to provide for certain reforms with respect to Medicare supplemental health insurance policies, and for other purposes. IN THE SENATE OF THE UNITED STATES AUGUST 1, 2019 Mr. BROWN (for himself and Ms. KLOBUCHAR) introduced the following bill; which was read twice and referred to the Committee on Finance 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, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 3 (a) SHORT TITLE.—This Act may be cited as the 4 ‘‘Medigap Consumer Protection Act of 2019’’. 5 (b) TABLE OF CONTENTS.—The table of contents of 6 this Act is as follows: 7 Sec. 1. Short title; table of contents. Sec. 2. Guaranteed issue. Sec. 3. Limitations on pricing discrimination. Sec. 4. Clarification regarding standardized Medigap plans. VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6211 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 2 •S 2428 IS Sec. 5. Improving information available to Medicare beneficiaries. Sec. 6. Broker conflicts of interest. Sec. 7. Protecting against high out-of-pocket expenditures for Medicare fee-for- service benefits. Sec. 8. Study and report on variations among Medigap plans. SEC. 2. GUARANTEED ISSUE. 1 (a) GUARANTEED ISSUE OF MEDIGAP POLICIES TO 2 ALL MEDIGAP-ELIGIBLE MEDICARE BENEFICIARIES.— 3 (1) IN GENERAL.—Section 1882(s) of the So- 4 cial Security Act (42 U.S.C. 1395ss(s)) is amend- 5 ed— 6 (A) in paragraph (2)(A), by striking ‘‘65 7 years of age or older and is enrolled for benefits 8 under part B’’ and inserting ‘‘entitled to, or en- 9 rolled for, benefits under part A and enrolled 10 for benefits under part B’’; 11 (B) in paragraph (2)(D), by striking ‘‘who 12 is 65 years of age or older as of the date of 13 issuance and’’; 14 (C) in paragraph (3)(B)(ii), by striking ‘‘is 15 65 years of age or older and’’; and 16 (D) in paragraph (3)(B)(vi), by striking 17 ‘‘at age 65’’. 18 (2) EFFECTIVE DATE; PHASE-IN AUTHORITY.— 19 (A) EFFECTIVE DATE.—Subject to sub- 20 paragraph (B), the amendments made by para- 21 graph (1) shall apply to Medicare supplemental 22 policies effective on or after January 1, 2023. 23 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 3 •S 2428 IS (B) PHASE-IN AUTHORITY.— 1 (i) IN GENERAL.—Subject to clause 2 (ii), the Secretary of Health and Human 3 Services may phase-in the implementation 4 of the amendments made under paragraph 5 (1) (with such phase-in beginning on or 6 after January 1, 2023) in such manner as 7 the Secretary determines appropriate in 8 order to minimize any adverse impact on 9 individuals enrolled under a Medicare sup- 10 plemental policy. 11 (ii) PHASE-IN PERIOD MAY NOT EX- 12 CEED 5 YEARS.—The Secretary of Health 13 and Human Services shall ensure that the 14 amendments made by paragraph (1) are 15 fully implemented by not later than Janu- 16 ary 1, 2028. 17 (3) ADDITIONAL ENROLLMENT PERIOD FOR 18 CERTAIN INDIVIDUALS.— 19 (A) ONE-TIME ENROLLMENT PERIOD.— 20 (i) IN GENERAL.—In the case of an 21 individual described in subparagraph (B), 22 the Secretary of Health and Human Serv- 23 ices shall establish a one-time enrollment 24 period during which such an individual 25 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 4 •S 2428 IS may enroll in any Medicare supplemental 1 policy of the individual’s choosing. 2 (ii) PERIOD.—The enrollment period 3 established under clause (i) shall begin on 4 the date on which the phase-in period 5 under paragraph (2) is completed and end 6 6 months after such date. 7 (B) INDIVIDUAL DESCRIBED.—An indi- 8 vidual described in this paragraph is an indi- 9 vidual who— 10 (i) is entitled to hospital insurance 11 benefits under part A under section 226(b) 12 or section 226A of the Social Security Act 13 (42 U.S.C. 426(b); 426–1); 14 (ii) is enrolled for benefits under part 15 B of such Act (42 U.S.C. 1395j et seq.); 16 and 17 (iii) would not, but for the provisions 18 of and amendments made by paragraphs 19 (1) and (2), be eligible for the guaranteed 20 issue of a Medicare supplemental policy 21 under paragraph (2) or (3) of section 22 1882(s) of such Act (42 U.S.C. 1395ss(s)). 23 (b) GUARANTEED ISSUE OF MEDIGAP POLICIES FOR 24 MEDICARE ADVANTAGE AND MEDICAID ENROLLEES, 25 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 5 •S 2428 IS CERTAIN VETERANS, AND OTHER INDIVIDUALS DETER- 1 MINED APPROPRIATE BY THE SECRETARY; TREATMENT 2 OF INDIVIDUALS WITH COBRA.— 3 (1) IN GENERAL.—Section 1882(s)(3) of the 4 Social Security Act (42 U.S.C. 1395ss(s)(3)) is 5 amended— 6 (A) in subparagraph (B), by adding at the 7 end the following new clauses: 8 ‘‘(vii) The individual was enrolled in a Medicare 9 Advantage plan under part C for not less than 12 10 months and subsequently disenrolled from such plan 11 and elects to receive benefits under this title through 12 the original Medicare fee-for-service program under 13 parts A and B. 14 ‘‘(viii) The individual— 15 ‘‘(I) is entitled to, or enrolled for, benefits 16 under part A and enrolled for benefits under 17 part B; and 18 ‘‘(II) either— 19 ‘‘(aa) is eligible for medical assistance 20 under a State plan or waiver under title 21 XIX based on a reduction of income of the 22 individual based on costs incurred for med- 23 ical or other remedial care and was en- 24 rolled in such plan or waiver; or 25 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 6 •S 2428 IS ‘‘(bb) was otherwise eligible for med- 1 ical assistance under a State plan or waiv- 2 er under title XIX and subsequently lost 3 eligibility for such medical assistance. 4 ‘‘(ix) The individual— 5 ‘‘(I) is entitled to, or enrolled for, benefits 6 under part A and enrolled for benefits under 7 part B; 8 ‘‘(II) is a covered beneficiary (as that term 9 is defined in section 1072(5) of title 10, United 10 States Code), entitled to medical and dental 11 care under chapter 55 of that title, who was re- 12 ceiving medical care at a facility of the uni- 13 formed services through such entitlement; and 14 ‘‘(III) no longer receives such care at such 15 facility because— 16 ‘‘(aa) such facility has been closed; 17 ‘‘(bb) such facility no longer offers 18 such care; 19 ‘‘(cc) the individual no longer meets 20 the requirements for eligibility for such 21 care; or 22 ‘‘(dd) the individual moved away from 23 the facility. 24 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 7 •S 2428 IS ‘‘(x) The individual meets such other require- 1 ments that the Secretary, through notice and com- 2 ment rulemaking, determines appropriate.’’; 3 (B) by striking subparagraph (C)(iii) and 4 inserting the following: 5 ‘‘(iii) Subject to subsection (v)(1), for purposes 6 of an individual described in clause (vi), (vii), (viii), 7 (ix), or (x) of subparagraph (B), a Medicare supple- 8 mental policy described in this subparagraph shall 9 include any Medicare supplemental policy.’’; and 10 (C) in subparagraph (E)— 11 (i) in clause (iv), by striking ‘‘and’’ at 12 the end; 13 (ii) in clause (v), by striking the pe- 14 riod at the end and inserting a semicolon; 15 and 16 (iii) by adding at the end the fol- 17 lowing new clauses— 18 ‘‘(vi) in the case of an individual described in 19 subparagraph (B)(vii), the annual, coordinated elec- 20 tion period (as defined in section 1851(e)(3)(B)) or 21 a continuous open enrollment period (as defined in 22 section 1851(e)(2)) during which the individual 23 disenrolls from a Medicare Advantage plan under 24 part C; 25 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 8 •S 2428 IS ‘‘(vii) in the case of an individual described in 1 subparagraph (B)(viii) who is eligible for medical as- 2 sistance under a State plan or waiver under title 3 XIX for a reason described in item (aa), such period 4 as is specified by the Secretary; 5 ‘‘(viii) in the case of an individual described in 6 subparagraph (B)(viii) who is eligible for medical as- 7 sistance under a State plan or waiver under title 8 XIX for a reason described in item (bb), the period 9 beginning on the date that the individual receives a 10 notice of cessation of such individual’s eligibility for 11 medical assistance under the State plan or waiver 12 under title XIX and ending on the date that is six 13 months after the individual receives such notice; 14 ‘‘(ix) in the case of an individual described in 15 subparagraph (B)(ix), during the 63 days after the 16 individual is no longer eligible to receive the care 17 from the facility described in such subparagraph; 18 ‘‘(x) in the case of an individual described in 19 subparagraph (B)(x), such period as is specified by 20 the Secretary; and’’. 21 (2) TREATMENT OF INDIVIDUALS WITH 22 COBRA.— 23 (A) IN GENERAL.—Section 1882(s)(3) of 24 the Social Security Act (42 U.S.C. 25 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 9 •S 2428 IS 1395ss(s)(3)), as amended by subsection (a) 1 and paragraph (1), is further amended— 2 (i) in subparagraph (B)(i) by insert- 3 ing ‘‘or, in the case of an individual en- 4 rolled in such an employee welfare benefit 5 plan pursuant to a COBRA continuation 6 provision (as defined in section 2791(d)(4) 7 of the Public Health Service Act), that the 8 individual disenrolls from such plan and 9 enrolls under part B’’ before the period at 10 the end; and 11 (ii) in subparagraph (E), as amended 12 by paragraph (1), by adding at the end the 13 following new clause: 14 ‘‘(viii) in the case of an individual described in 15 subparagraph (B)(i) who enrolled in an employee 16 welfare benefit plan described in such subparagraph 17 pursuant to a COBRA continuation provision (as de- 18 fined in section 2791(d)(4) of the Public Health 19 Service Act) and who disenrolls from such plan and 20 enrolls under part B, the period beginning on the 21 date that is 60 days before the effective date of such 22 disenrollment and ending on the date that is 63 days 23 after such effective date.’’. 24 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 10 •S 2428 IS (B) TECHNICAL CORRECTION.—Section 1 1882(s)(2)(D) of the Social Security Act (42 2 U.S.C. 1395ss(s)(2)(D)) is amended— 3 (i) by striking ‘‘2701(c)’’ and insert- 4 ing ‘‘2704(c)’’; and 5 (ii) by striking ‘‘2701(a)(3)’’ and in- 6 serting ‘‘2704(a)(3)’’. 7 (3) EFFECTIVE DATE.—The amendments made 8 by paragraphs (1) and (2)(A) shall apply to Medi- 9 care supplemental policies effective on or after Janu- 10 ary 1, 2023. 11 (c) MEDPAC STUDIES AND REPORTS.— 12 (1) ANNUAL OPEN ENROLLMENT.— 13 (A) STUDY.—The Medicare Payment Advi- 14 sory Commission (in this section referred to as 15 the ‘‘Commission’’) shall conduct a study on 16 providing an open enrollment period for Medi- 17 care supplemental policies (under section 1882 18 of the Social Security Act (42 U.S.C. 1395ss)) 19 under which an individual could enroll in such 20 a policy with guaranteed issue protections. Such 21 study shall include an analysis of— 22 (i) the impact of the ‘‘birthday rule’’ 23 in California and Oregon, where an indi- 24 vidual can enroll with such protections in 25 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 11 •S 2428 IS a new policy with the same or lesser bene- 1 fits within 30 days of their birthday; 2 (ii) the impact of such birthday rule if 3 such rule permitted the individual to enroll 4 with such protections in any policy; and 5 (iii) other areas determined appro- 6 priate by the Commission. 7 (B) REPORT.—Not later than 2 years after 8 the date of the enactment of this Act, the Com- 9 mission shall submit to Congress a report on 10 the study conducted under subparagraph (A), 11 together with recommendations for such legisla- 12 tion and administrative action as the Commis- 13 sion determines appropriate. 14 (2) EQUITABLE RELIEF.— 15 (A) STUDY.—The Medicare Payment Advi- 16 sory Commission (in this section referred to as 17 the ‘‘Commission’’) shall conduct a study on the 18 Secretary of Health and Human Services grant- 19 ing equitable relief for enrollment in a Medicare 20 supplemental policy (under section 1882 of the 21 Social Security Act (42 U.S.C. 1395ss)) in a 22 similar manner as the Secretary grants such re- 23 lief for enrollment under part B of the Medi- 24 care program. 25 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 12 •S 2428 IS (B) REPORT.—Not later than 2 years after 1 the date of the enactment of this Act, the Com- 2 mission shall submit to Congress a report on 3 the study conducted under subparagraph (A), 4 together with recommendations for such legisla- 5 tion and administrative action as the Commis- 6 sion determines appropriate. 7 (d) OUTREACH PLAN.— 8 (1) IN GENERAL.—The Secretary of Health and 9 Human Services shall develop an outreach plan to 10 notify individuals (including individuals described in 11 clause (viii) of section 1882(s)(3)(B) of the Social 12 Security Act (42 U.S.C. 1395ss(s)(3)(B)), as added 13 by subsection (b)(1)) that may be affected by the 14 provisions of, and amendments made by, this section 15 regarding such provisions and amendments. 16 (2) CONSULTATION.—In implementing the out- 17 reach plan developed under paragraph (1), the Sec- 18 retary of Health and Human Services shall consult 19 with consumer advocates, brokers, insurers, the Na- 20 tional Association of Insurance Commissioners, and 21 State Health Insurance Assistance Programs. 22 VerDate Sep 11 2014 20:59 Aug 16, 2019 Jkt 089200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S2428.IS S2428 khammond on DSKBBV9HB2PROD with BILLS 13 •S 2428 I [Text truncated for display. Full text available on Congress.gov.]