CMS Pub. 100-04, ch. 28, § 10

The Omnibus Budget Reconciliation Act of 1990 (OBRA 1990, Public Law 101-508) requires all Medicare

supplemental (Medigap) insurance policies to conform to minimum standards including loss ratio

requirements, standardized benefit packages and consumer protection requirements.

The procedures described in §§20 through 110 apply to all policies meeting the definition of Medicare

supplemental insurance policies (“Medigap”) in §1882(g)(1) of the Social Security Act (the Act.).

A Medigap policy is defined as: A group or individual policy of accident and sickness insurance, or a

subscriber contract of hospital and medical service associations or health maintenance organizations, other

than a policy issued pursuant to a contract under §1876 or §1833 of the Act, or a policy issued under a

demonstration project.

A Medigap policy is offered by a private company to those entitled to Medicare benefits and provides

payment for Medicare charges not payable because of the applicability of deductibles, coinsurance amounts

or other Medicare imposed limitations. Typically, a Medigap policy does not include limited benefit

coverage areas available to Medicare beneficiaries, such as “specified disease” or “hospital indemnity”

coverage. By law, the definition explicitly excludes a policy or plan offered by an employer to employees, or

former employees, as well as policies offered by a labor organization to members or former members.

The National Association of Insurance Commissioners has developed model regulatory language for State

insurance commissions to apply to Medigap insurance offerings. This model regulatory language is located

at: http://www.carfra.com/products/medsupappendixb.pdf. It recommends the requirements that states

should consider for approving proposed Medigap insurance plans.

The following procedures for furnishing information are mandatory for Medigap plans. Medicaid agencies

are furnished information in the standard format free of charge. Other commercial payers, including

Medigap insurers, must pay a CMS established per claim crossover fee for providing them with Medicare

paid claims data.