NAIC: Don't require Medigap cost-sharing

State insurance commissioners on Wednesday urged the deficit-cutting supercommittee not to restrict Medigap coverage.

Many of the supplemental policies offer what's knows as "first-dollar" coverage, meaning they don't require co-pays or coinsurance. Various menus of deficit-reduction options have included a proposal to eliminate first-dollar coverage in Medigap plans.

But the National Association of Insurance Commissioners said that change would be disruptive to seniors, particularly if it was applied to existing policies.

The so-called first dollar coverage contained in Medigap policies has been factored into the premium payments of these Medigap policyholders," the NAIC said in a letter to the supercommittee. "Now, by federal law, in the name of deficit reduction, these senior citizen Medicare-eligible citizens would not have a benefit for which they have already paid, in many cases, for years."

President Obama's supercommittee recommendations include a roundabout proposal that would discourage first-dollar Medigap coverage without explicitly banning it. The policy is estimated to save the federal government $2.5 billion over 10 years, and would only apply to new plans.