AARP backs bill to extend new rules on insurers’ spending

{mosads}The insurance industry opposes Kerry and Stark’s bill.

The healthcare law’s MLR requirements didn’t extend to Medigap because it’s a form of supplemental coverage, said Robert Zirkelbach, a spokesman for America’s Health Insurance Plans. He said Congress has traditionally recognized that supplemental coverage is different from comprehensive policies and therefore excluded almost all supplements from healthcare reform’s new regulations.

As supplements, Medigap plans collect lower premiums than comprehensive policies, but the administrative costs aren’t necessarily lower. Extending the 80 to 85 percent MLR standards to Medigap would disrupt coverage with which seniors are satisfied, Zirkelbach said.