Strong Enrollment in Medigap Plans Continues Among US Seniors

Beneficiaries increasingly choosing health care plans that include some cost-sharing reduction provisions for co-pays and coinsurance.

Enrollment in Medigap plans has continued to increase among senior citizens for the fifth year in a row, according to a new report from America’s Health Insurance Plans (AHIP)’s Center for Policy and Research.

Between December 2013 and December 2014, enrollment in Medigap private health insurance plans that supplement fee-for-service (FFS) Medicare increased to 11.2 million people, up from approximately 10.6 million the year before.

The report found that 94% of Medigap policyholders are satisfied with their coverage and more than 9 in 10 would recommend Medigap to a friend or relative to fill the gaps left by traditional Medicare.

“Millions of seniors continue to recognize the value of Medigap coverage in filling the gaps left by traditional Medicare,” AHIP President and CEO Marilyn Tavenner said in a statement.

The report, “Trends in Medigap Coverage and Enrollment, 2014,” found that consistent with previous years, beneficiaries are increasingly choosing to enroll in Medigap plans that include at least some cost-sharing reduction provisions for co-pays and coinsurance.

Over the last several years, the fastest-growing Medigap plans have included newer standardized Medigap plans that contain enrollee cost-sharing requirements, AHIP found. For example, the highest rate of growth in enrollment was in Medigap Plan N, which includes cost sharing of up to $20 for physician office visits and up to $50 for certain emergency room visits.

Enrollment in Medigap Plan N grew by 33% between December 2013 and December 2014.

With more beneficiaries enrolling in Medigap, AHIP is urging policymakers to avoid cutting benefits or enacting changes that would threaten coverage for million of senior citizens with disabilities through proposals that limit Medigap coverage of enrollee cost-sharing and place a surcharge on Medigap policies.

“These changes would significantly undermine the value that Medigap policies provide and disproportionally harm the most vulnerable Medicare beneficiaries,” an AHIP statement noted, “including those low- and moderate-income seniors and individuals managing multiple chronic conditions.”

A 2011 white paper by AHIP Coverage concluded that an across-the-board ban on first-dollar coverage Medigap plans invites adverse, unintended consequences. Research has shown that limiting first-dollar coverage in Medigap policies would cause beneficiaries to avoid care that is medically necessary, resulting in higher costs for enrollees and the country.