Medigap Policies Face New Federal Nondiscrimination Rule

[sshafran]

If medigap does go to no UW, it will only make MA more attractive.

"Go with $0. If you get cancer in 2029 we'll just get you medigap then, no pre-ex, as long as we do it during these time frames."

(It's not that far off from NC where we have blue-to-blue - BCBSs MAs can get Med Supp w/o UW)

 

[somarco]

"Go with $0. If you get cancer in 2029 we'll just get you medigap then, no pre-ex, as long as we do it during these time frames."

And watch what is left of the Medigap market go BOOM . . .

 

[sshafran]

And watch what is left of the Medigap market go BOOM . . .

I certainly hope not.

People still like and pay for the freedom, etc, of OM + Medigap. Even here in NC where we have somewhat of a "back door" to get back to Medigap - it really only helps with that prospect who is 85% sure he/she wants MAPD but is slightly worried that it might come back to be a bad decision later.

But - you're probably right. It won't be good for the med supp market but it wouldn't be 1 carrier absorbing all of it. Even here w BCBSNC doing their guaranteed program their rates are not that astronomical. I'm just thinking if every carrier has to go GI it'll eventually shake out like ACA where eventually they'll want business again. But, could be wrong!

 

[somarco]

The reinsurance market for Medicare supplement is relatively small compared to other markets. Once losses on a block start to climb the reinsurance carrier will drop the issuing carrier rather than continue to absorb losses.

The issuing carrier has to look for another reinsurer or else drop out of the market. The next reinsure will charge more and/or take a smaller portion of the risk.

If this package (GI, unisex, community rated) actually happens the number of issuing carriers will drop like a rock and that market may never recover.

OM/Medigap is basically supporting the MA market with higher reimbursement and taking on more of the risk. If OM/Medigap go away the MA market will collapse.

Look how long it took the Obamacare market to stabilize and the under 65 market is relatively healthy.

Not so for the 65+ market.

The 65+ Medigap market is essentially controlled by 2 carriers. They are large enough to absorb losses and move forward. One of those carriers has half a dozen issuing carriers to rotate and churn the market every 3 or 4 years.

How many MA beneficiaries are willing and able to afford Medigap premiums north of $300 when they are accustomed to $0 but can't pay their medical bills now?

Medigap carriers do their best to discourage high risk policyholders with high premiums (under 65 SSDI prospects) and 65+ GI situations by cutting agent comp to near zero in hopes of steering those folks to MA plans.

Medigap carriers will bail from the market if they are forced into a year round GI scenario.

 

[somarco]

And this from the Think Adviser link . . .

Nondiscrimination requirements for insurance products not previously subject to federal health nondiscrimination regulations will apply to coverage starting on or after Jan. 1, 2025.

If that happens, expect fewer carriers and MUCH higher rates previewed in the market place as early as October . . . before the election.

If Joe and his cohorts are hoping to push this through as another vote buying ploy they will be in for a different kind of October surprise.

Private insurers write the policies, based on standardized templates included in federal statutes. State insurance regulators oversee the insurers.

The insurers must sell the policies on a guaranteed-issue basis during a six-month open enrollment period after a consumer first becomes eligible for Medicare.

But, in many states, issuers can consider age and health status when selling policies to consumers who do not qualify for an open enrollment period or a special enrollment period.

Many states is an understatement . . . roughly 40 states allow medical underwriting outside of IEP.

The author of this article is a lefty's wet dream. I have seen her articles for 20 years and her bias always comes through.

 

[somarco]

One way to salvage the Medigap market if this autocratic regulation is imposed is for carriers to adopt the AARP/UHC model with 2 tier rates. One for IEP and healthy people, another set of rates reserved for those who can fog a mirror.

Some carriers already have preferred and standard rates for others. Some carrier standard rates are 20 - 25% higher than preferred. If they expand that to 100% higher no one will buy those plans.

 

[rousemark]

One way to salvage the Medigap market if this autocratic regulation is imposed is for carriers to adopt the AARP/UHC model with 2 tier rates. One for IEP and healthy people, another set of rates reserved for those who can fog a mirror.

Some carriers already have preferred and standard rates for others. Some carrier standard rates are 20 - 25% higher than preferred. If they expand that to 100% higher no one will buy those plans.

If they can not ask health questions how w I uld decide who was preferred and who was standard?

 

[somarco]

If they can not ask health questions how w I uld decide who was preferred and who was standard?

If IEP rules still exist, use preferred for T65.

Also, I presume the "don't ask, don't tell" only applies to carriers, not agents.

 

[Yagents]

Bedtime reading... released today

Federal Register :: Request Access

 

[rmhaire]

Bedtime reading... released today

Federal Register :: Request Access

Ain't no damn way.

Did glance at it though. I got down to the part that mentioned @DonP and his marketing money.