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Committee approves 'birthday rule' to let Medigap enrollees change same-letter plans without underwriting once a year
Summary
The Insurance Committee passed House Bill 12-26, a bill to allow Medicare supplement (Medigap) enrollees to switch laterally among same-letter supplement plans within a 60-day window around their birthday (the so-called 'birthday rule'), limited to age 65+ by amendment. Supporters said the rule can produce substantial premium savings for seniors.
House Bill 12-26, sponsored by Representative Dan Chesser, would allow Hoosiers enrolled in Medicare supplement (Medigap) coverage to change laterally among the same lettered supplement plans without medical underwriting during a 60‑day window around their birthday, provided the person meets the bill’s eligibility tests. The committee adopted a technical amendment clarifying the measure applies to people aged 65 and older and voted 10-0 to pass the bill.
Chesser said the change would create a cost-saving opportunity for seniors who elected to remain in original Medicare and purchase a Medigap plan rather than enroll in Medicare Advantage. Insurance agent Mark Davis, who brought the idea to lawmakers after seeing it adopted in Kentucky and other states, testified with several real-world examples of premium reductions for elderly clients who switched to competitively priced carriers under similar rules in other states.
Witnesses including Amber Marr of AARP Indiana and Laura Penman of the Indiana Retired Teachers Association supported the bill, saying it would give fixed‑income seniors more ability to shop and reduce premiums without losing coverage. Marr noted that Medigap buyers have a six‑month initial open enrollment period at age 65 but that after that period they face medical underwriting when switching; the birthday rule creates an additional narrow yearly opportunity to switch without underwriting as long as they elect the same lettered plan.
Committee members asked about potential premium impacts and whether carriers could respond by raising rates; witnesses said they would provide comparative data from other states to the committee and recommended monitoring outcomes. Sponsor Chesser accepted a chairman’s amendment to ensure the text limits the benefit to those aged 65 and older; the amendment also clarified application language. The committee approved the bill as amended by roll call vote 10-0 and forwarded it to the next stage.
Supporters emphasized the bill is limited to “lateral” moves (same letter plan) to avoid annual upgrades that could drive costs and that it preserves consumer protections while allowing seniors to seek lower premiums from other carriers without facing underwriting barriers.
