[Congressional Record Volume 162, Number 148 (Thursday, September 29, 2016)]
[Extensions of Remarks]
[Page E1402]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




              THE MEDIGAP CONSUMER PROTECTION ACT OF 2016

                                 ______
                                 

                           HON. JIM McDERMOTT

                             of washington

                    in the house of representatives

                     Wednesday, September 28, 2016

  Mr. McDERMOTT. Mr. Speaker, Medigap plans currently provide 
supplemental coverage to approximately 11 million Medicare 
beneficiaries. However, many of the laws governing the Medigap market 
have remained largely unchanged since 1990. In particular, consumer 
protections are inadequate, leaving many beneficiaries subject to 
discriminatory practices by issuers, lacking sufficient information 
about their plan options, and often enrolled in lower quality coverage.
   That is why, today, I am introducing the Medigap Consumer Protection 
Act. This important legislation will make a number of reforms to the 
Medigap market that will strengthen the health security of millions of 
Americans and significantly improve the beneficiary experience.
   Most importantly, this bill ends discriminatory treatment of 
Medicare beneficiaries by extending guaranteed issue rights to the 
entire Medigap-eligible population.
   Currently, federal law provides limited guaranteed issue rights to 
Medicare beneficiaries. As a result, issuers in many states are 
permitted to deny consumers access to Medigap policies based on 
preexisting conditions. This creates substantial barriers to coverage, 
particularly for individuals who qualify for Medicare due to disability 
or End-Stage Renal Disease. According to the Kaiser Family Foundation, 
only 2 percent of beneficiaries who are under 65 and living with a 
disability are enrolled in a Medigap policy, and 21 percent have no 
supplemental coverage at all.
   The Medigap Consumer Protection Act closes the holes in federal law 
that permit discriminatory treatment of consumers by extending 
guaranteed issue rights to the entire Medicare population, including 
beneficiaries who qualify for Medicare due to disability or End-Stage 
Renal Disease.
   It also will protect a number of other populations, including 
beneficiaries who have enrolled in Medicare Advantage for more than one 
year and wish to switch back to traditional Medicare; dual eligibles 
who either lose their Medicaid coverage or who are only Medicaid-
eligible with a Share of Cost; and individuals enrolled in COBRA 
coverage who wish to switch into Medicare.
   The bill also makes a number of reforms that will strengthen access 
to quality plans and improve the beneficiary experience.
   It calls on the National Association of Insurance Commissioners to 
review loss ratio standards for Medigap plans and submit 
recommendations to the Secretary to update federal standards.
   It reforms how issuers price their products by calling on the NAIC 
to update its Model Regulations to prohibit pricing discrimination 
based on age, and by requiring Medigap issuers to set premiums by 
county.
   It requires the Secretary of Health and Human Services to improve 
the Medicare Plan Finder website to increase consumer access to 
information regarding their coverage options through Medicare, Medigap, 
Medicare Advantage, and Part D. The public will be afforded 
opportunities to comment on and improve the presentation of this 
information.
   It restores access to the most popular Medigap plan options, which 
under current law are scheduled to be eliminated for beneficiaries who 
become eligible for Medicare beginning in 2020 or later.
   Finally, it provides consumers with additional information about 
potential conflicts of interest by requiring issuers to disclose 
payments made to brokers, agents, and other third parties selling 
Medigap policies. These disclosures will be available to consumers 
through the Open Payments Database maintained by the Centers for 
Medicare and Medicaid Services.
   Mr. Speaker, Medicare beneficiaries deserve access to high-quality 
Medigap coverage. The reforms made by the Medigap Consumer Protection 
Act will correct many of the problems that continue to exist in the 
market, including discrimination by issuers and a lack of information 
available to consumers. These reforms are long overdue, and I urge my 
colleagues to move to enact this bill without delay.

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