Good News for Medicare Supplement Plan F policyowners

One more aspect of the Affordable Care Act that has been modified in favor of the owners of a Medicare Supplement Plan C or Plan F.

The U.S. Department of Health and Human Services (HHS) has taken the National Association of Insurance Commissioners (NAIC)'s advice not to impose a nominal cost sharing in Medicare Supplement insurance Parts C and F. Kathleen Sebelius, a former NAIC president herself, wrote in a letter to current NAIC President Jim Donelon "I value the NAIC's expertise on Medigap and other health insurance issues and the strong partnership between NAIC and the U.S. Department of Health and Human Services. This partnership has been instrumental in the effective implementation of numerous provisions of the Affordable Care Act."

The HHS had requested under PPACA that the NAIC revise the NAIC Medicare supplement insurance model to include a nominal cost sharing in Medigap Plans C and F to encourage the use of appropriate physician's services under Medicare Part B.

However, last December, the NAIC recommended against this nominal cost sharing and did not revise the standard benefit packages for these model plans. Besides studying the issue, the NAIC communicated caution with proceeding with nominal Medigap cost sharing because it could delay treatments that people really need. This would make the more vulnerable populations worse off in the long run with costly hospitalizations and emergency room visits. Also, when referencing the changes to Medigap's plan offerings that started in 2010, the NAIC stated "We are still learning the impact of these new offerings on both the Medigap market and to the Medicare program."

Despite the HHS agreeing to not go forward with these changes, the Medicare Trustee report has projected that the trust fund that finances Medicare's hospital insurance coverage will stay solvent until 2026, which is two years longer than it was projected last year. Additionally, Medicare Part B and Medicare Part D are both projected to remain funded into the foreseeable future because current law automatically provides financing each year to meet the next year's expected costs.