Medigap Coverage: Medicare Part D 

The Medicare Modernization Act (MMA) of 2003 created two new standardized policies, K and L. These policies provide an annual cap on out-of-pocket expenditures for Medicare Parts A and B deductibles, co-payments, and co-insurance amounts.

In addition, the MMA prohibited issuing new Medigap H, I, or J policies with prescription drug coverage. Individuals were able to renew their H, I, or J policy under certain conditions. However, the addition of a prescription drug benefit under Medicare Part D has impacted the availability and premiums for these policies and has made H, I, and J (without drug coverage) duplicative of other Medigap offerings. However, if an individual retains H, I, or J coverage with prescription benefits, it is not considered creditable coverage and Part D penalties will apply upon enrollment.

For more information on the options that beneficiaries have when making a decision about their prescription drug coverage, please see HAP’s tool, Medicare Part D and Medigap: Medigap Policies with Prescription Drug Coverage (H, I, J).

Note: If you live in Massachusetts, Minnesota, or Wisconsin, these standardized plans do not apply to you. For more information, please refer to your SHIP or State Department of Insurance.

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Other Resources

2008 Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare by the Center for Medicare & Medicaid Services (CMS)

National Association of Insurance Commissioners (NAIC)

If you have a question that is not covered in these resources, please email HAP at SHIPHelp@hapnetwork.org and we will respond to your request within two business days.