Committee advances ‘birthday rule’ to let Medicare supplement enrollees change plans once a year

Senate Bill 80, commonly described as a Medigap “birthday rule,” received a do-pass recommendation from the Health and Public Affairs Committee after testimony from seniors, patient advocates, dialysis providers and insurers.

Sponsor Senator Stefanik said the bill would allow individuals who are on original Medicare and purchased a Medigap policy to change their Medicare supplement plan once per year during a 60-day window without medical underwriting for preexisting conditions. She and witnesses said about 70,000 New Mexicans are enrolled in original Medicare and would be eligible to shop during that window.

Susan Ellen Bogan, a witness who said she moved to New Mexico and previously had the ability to shop for Medigap coverage without underwriting, described being effectively “trapped” in a more expensive plan after moving because New Mexico requires medical underwriting after the initial enrollment period. Patient groups including the League of Women Voters and dialysis provider Fresenius testified in support.

The insurance industry, represented by America's Health Insurance Plans (AHIP), opposed the bill, warning of adverse selection and likely premium increases for existing Medigap policyholders. Committee members asked the Office of Superintendent of Insurance about rate-setting and whether insurers could adjust premiums after pools shift; the insurance office said it would provide a written response from its actuary on how annual risk-pool changes could affect rates.

After debate and several explanations of vote, the committee voted to give the bill a due-pass recommendation. Senators who voted against expressed concern about possible premium increases and the effect on marginal consumers.