MEDIGAP REFORM LEGISLATION OF 1990 - HAVE THE OBJECTIVES BEEN MET

The 1990 medigap reform legislation had multiple objectives: To simpli fy the insurance market in order to facilitate policy comparison, Prov ide consumer choice, provide market stability, promote competition, an d avoid adverse selection. Based on case study interviews with a cross -section of individuals and organizations, we report that most of thes e objectives have been achieved. Consumers of medigap plans are able t o make more informed choices, largely because they can adequately comp are policies based on standard benefits. Marketing abuses have apparen tly declined, as evidenced by a decrease in the number of consumer com plaints. Finally, no major detrimental impact on the insurance industr y was detected. Beneficiaries still face some confusion in this market , however, such as understanding the rating methodologies used to set premiums and how this may affect their choices. Confusion could increa se with the growth of managed care options.