Medigap
Restricting Underwriting and Premium Rating Practices in the Medigap Market: The Experience of Three States
Research Report
Steven Lutzky, AARP Public Policy Institute
Lisa Maria B. Alecxih, The Lewin Group
Veena Pankaj, The Lewin Group
Stephanie Laud, The Lewin Group
Genevieve Schaab, The Lewin Group
January 2001
In this AARP Public Policy Institute study, The Lewin Group examined the effect of state requirements restricting Medigap insurers' ability to screen for health conditions and to set rates that automatically increase with age. Lewin compared the availability and affordability of Medigap coverage in three states with such restrictions (Connecticut, Florida, New York) to that in three states without such restrictions (Arizona, Ohio, Virginia).
The study found that restricting underwriting and premium rating practices appears to increase access to Medigap policies for individuals with health conditions, while leaving healthy consumers with multiple affordable choices among insurers. The findings also indicate that, while additional regulations decreased the pool of insurers competing in the market, consumers still have choices among insurers.
A final finding was that the affordability of Medigap coverage, measured as the cost of premiums as a percent of median family income, also appeared to have declined substantially between 1995 and 1998 in all of the states examined in the study. (26 pages)
Pub ID: 2001-01