Medigap Insurance Markets - Mathematica Policy Research

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Dec 13, 2001 - lives (as reported by Medigap insurers) per Medicare beneficiary (as ..... Union Life) to $1,220 (quoted by Bankers Life and Casualty Company).
MPR Reference No.:

8733-310

MEDIGAP INSURANCE MARKETS: S TRUCTURE, CHANGE, AND IMPLICATIONS FOR MEDICARE December 13, 2001

Submitted to:

Submitted by:

Office of the Secretary Assistant Secretary for Planning and Evaluation U.S. Department of Health & Human Services 200 Independence Avenue, SW Washington, DC 20201 Attention:

Stephen Finan Contracting Officer

Mathematica Policy Research, Inc. 600 Maryland Avenue, SW Suite 550 Washington, DC-20024 Telephone: (202) 484-9220 Contact Person: Deborah Chollet

MEDIGAP INSURANCE MARKETS: STRUCTURE, CHANGE, AND IMPLICATIONS FOR MEDICARE by Deborah Chollet Mathematica Policy Research and Adele Kirk University of California at Los Angeles

A.

INTRODUCTION The market for private insurance to supplement Medicare (Medigap) is both large and complex. In

1999, Medigap insurers covered 10.4 million lives, equal to 27 percent of all Medicare beneficiaries, elderly or disabled. The market includes both group and individual policies, and both Astandard@ and "prestandard" product designs. In addition, markets vary across states, which have jurisdiction to regulate Medigap policies in conformance with federal law. Some states impose additional restrictions on Medigap insurers, affecting how they underwrite risk and rate policies. This report describes the Medigap market in 1999, both nationally and by state. It also compares the national profile of the states= Medigap markets in 1999 with that in 1997 to offer a picture of how Medigap markets are changing. The information is based on data that the National Association of Insurance Commissioners (NAIC) compiles from the standard reports that insurers file in every state. Because these data are insurer-based (not population-based), at least two caveats are in order. First, people who have multiple Medigap policies are counted in the data multiple times. While it was the intent of OBRA-90 to eliminate duplicative coverage by standardizing Medigap policies, its success is undocumented even in the standardized segment of the market. More than a quarter of individual Medigap policies in force are pre-standard, and these probably represent some multiple coverage. Nevertheless, population-survey estimates of Medigap coverage and insurers’ reports of covered lives in 1999 are nearly

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identical.1 Thus, we presume that Medigap policyholders typically have only one policy, and we use the terms covered lives and policyholders interchangeably. Second, as reported by insurers, group-covered Medigap lives include people enrolled in insured employer-sponsored retiree plans and also people enrolled in association plans, such as that sponsored by AARP and others. In contrast, population surveys generally regard Medicare beneficiaries enrolled in association plans as individually insured. Because the total number of covered lives that Medigap insurers reported is nearly identical to the number of Medicare beneficiaries who, in population surveys, report Medigap coverage, we presume that virtually all of the group business reported by Medigap insurers is association business. By inference, we presume that employer-sponsored retiree benefits are nearly always self-insured, and therefore they are not reflected significantly in this report. The following sections describe enrollment, marketing and pricing of Medigap insurance products in 1999. We describe the general distribution of enrollment in individual and group (association) policies, and then turn exclusively to individual policies – the much larger segment of the market – to explore insurer marketing and premiums in the aggregate and by state. We then discuss the changes in the Medigap market that occurred between 1997 and 1999, comparing insurer reports of covered lives and average premiums in each year. Finally, we offer some concluding comments about the Medigap market and possible implications for the Medicare program. However, first we offer some context about Medigap markets to provide a basis for the understanding descriptive sections that follow.

B.

UNDERSTANDING THE MEDIGAP MARKET Competition in the Medigap market appears to be extremely limited. Indeed, Federal law and most

state laws define Medigap markets that are highly rigid, certainly in product design, but also in the rules that insurers may use to protect their business from adverse selection. In effect, these rules lock most policyholders into both a carrier and a specific policy one year after they initially choose a Medigap policy at age 65.

Except to enter (or within one year, to leave) a Medicare+Choice plan, most Medicare

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Tabulations of the Medicare Current Beneficiary Survey indicate that 26 percent of Medicare beneficiaries had “individual” Medigap coverage in 1998 (Poisal and Murray, 2001). The ratio of group and individual covered lives (as reported by Medigap insurers) per Medicare beneficiary (as reported by HCFA) was 27 percent in 1999.

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beneficiaries may have no real option ever to change their insurer or particular Medigap policy for the rest of their lives. Specifically, unless otherwise constrained by state law, insurers may: C

deny initial coverage to any applicant who has been enrolled in Medicare longer than 6 months;

C

deny current policyholders from moving (within carrier) to any other policy form 12 months after initial enrollment;2

C

deny beneficiaries leaving Medicare+Choice plans or retiree health insurance plans3 coverage in any policy form except A, B, C or F (none of which cover prescription drugs);

C

deny applicants leaving Medicare+Choice or employer-sponsored retiree coverage any policy except A, if more than 63 calendar days have elapsed; and

C

restart a 6-month waiting period for coverage of preexisting conditions when a beneficiary changes Medigap policies.4, 5

Moreover, many insurers price Medigap policies on an entry-age (or issue-age) basis. Entry-age premiums are “front-loaded.” In effect, they require policyholders to pay higher initial premiums in order to 2

Within 12 months of Medigap enrollment, insurers must guarantee issue to current policyholders every policy form that they sell. However, as described later in this report, most insurers sell only one or two policy forms in a state, other than policy form A (which all individual Medigap insurers are required to sell). In practice, many insurers may allow current policyholders to “trade down” to policy form A without underwriting, although in general state regulation does not require them to do so. 3

Specifically, insurers must guarantee issue selected policy forms (A, B, C and F), if they sell those policy forms at all, to Medicare beneficiaries within 63 days of leaving either a Medicare-approved managed care plan for designated reasons or an employer-sponsored retiree health plan because the plan was terminated or benefits were reduced. 4

The 1997 Health Insurance Portability and Accountability Act (HIPAA) exempts supplemental health insurance policies from its portability provisions. However, the NAIC model regulations prohibit Medigap insurers from excluding coverage for conditions that existed only before the six months prior to coverage, and from excluding coverage for any preexisting condition longer than six months. 5

Massachusetts offers a notable exception to these rules. Massachusetts requires Medigap insurers to hold an annual 2-month open enrollment period during which the insurer must offer to any Medicare beneficiary (except ESRD enrollees) any policy that the insurer currently sells. However, insurers may apply a surcharge for applicants who first apply for Medigap coverage after the first six months of Medicare Part B enrollment, who have a break in Medigap coverage longer than 30 days, or who are upgrading coverage.

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minimize annual premium increases. A policyholder who cancels an entry-age-rated policy after age 65 forfeits an asset: the higher initial premiums already paid. Thus, entry-age rating may further discourage Medicare beneficiaries from moving among Medigap policies, even if they would pass the insurer’s underwriting screen. If other available Medigap policies also are entry-age rated, older Medicare beneficiaries hoping to change policies may find no alternative that is less expensive for the same coverage.6 In summary, Medicare beneficiaries are constrained in many ways from moving among Medigap carriers and policies after they first select a Medigap policy at age 65. In most states, policyholders have very little opportunity to respond to differences in prices or service, or to register a change in their demand for coverage. The underwriting barriers that insurers apparently have erected to discourage policyholders from moving from one plan to another after age 65 are so significant that prevailing patterns of Medigap coverage are unlikely to have any relationship to current market circumstances.7 As a result, it is not surprising that competitive patterns of coverage or prices would fail to emerge for beneficiaries older than age 65, and therefore that they would not be apparent in the Medigap market as a whole.

C.

ENROLLMENT IN MEDIGAP POLICIES In this section we describe relative enrollment in individual and group (that is, association) Medigap

plans, and in standard and pre-standard plans. Medigap policyholders in the individual market are more likely than group policyholders to be enrolled in standard policy forms. In both markets, standard enrollment is concentrated in just three policy forms: F, C and B.

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Insurers may rate Medigap policies on an entry-age basis, attained age basis, or community-rated basis. Because attained-age premiums are not front-loaded, they may be lower than entry-age rates at age 65 (all else being equal). However, attained-age premiums may rise more steeply over the policyholder’s lifetime. Community-rated policies (such as those marketed through AARP) average the cost of coverage over the whole group (irrespective of health status) and they also may soften or eliminate the age gradient. Thus, communityrated policies may be either more or less expensive at age 65 than policies priced an entry-age (front-loaded) basis, but they probably are less expensive in later years than an attained-age-rated policy. Of 43 states that responded to a NAIC survey in 1999, six states prohibited Medigap insurers from using entry-age rating, ten prohibited attained-age rating, and eight required community rating (NAIC, 2000). 7

In 1996, the GAO reported that 16 of the 25 largest national Medigap insurers underwrote all or some of their policies (GAO, 1996). The report did not distinguish between individual and group policies issued by these insurers or among states where insurers wrote coverage.

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1.

Individual vs. Group Enrollment In 1999, 75 percent of Medigap policyholders were enrolled in individual policies; all other

policyholders were enrolled in group policies, which we assume are association plans. The relative likelihood of holding an individual or group policy varies markedly from state to state (see Table 1). In nine states,8 most Medigap policyholders were in group policies; in California and New Jersey, more than twothirds were in group policies. But in 22 states and the District of Columbia, at least 90 percent were in individual Medigap policies. The reasons for these differences among states are unclear. As described earlier, they may relate to historical differences in Medigap marketing and pricing, and not principally to current market circumstances. They also may reflect differences in the states’ regulation of individual versus group policies. However, there is no source of information that documents the extent of such differences in either insurer practice or state regulation of Medigap insurers.

2.

Standard Versus Pre-standard Policies OBRA-90 standardized new Medigap coverage in the individual market and also in the segment of

the group market that is comprised of association plans.9 OBRA-90 established ten standard policy forms that differ in the scope of coverage and the amount of cost-sharing they entail. Policies that were issued before OBRA-90's effective date, July 1992, were grandfathered. That is, insurers have been able to renew pre-standard policies since July 1992, but they cannot issue new pre-standard policies. Thus, all pre-standard policyholders are now at least age 74. In 1999, about one-third of all Medigap policyholders were in pre-standard plans (see Table 2). While the benefit design of pre-standard policies is in fact unknown, many may have some coverage for prescription drugs.10 If so, this might in part explain the apparent reluctance of pre-standard policyholders to move into the standardized market, even if they were able to pass insurers’ underwriting screens.

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Arizona, California, Hawaii, Massachusetts, New Jersey, New Mexico, New York, Ohio and Vermont.

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Employers and unions are, in effect, exempt from OBRA-90 rules. Employers that sponsor retiree benefits may contract with insurers to cover specific wrap-around benefits that may not conform to any standard plan design. However, insurers may not broadly market such products. 10

The number of covered lives in pre-standard policies in 1999, combined with the number in standard H, I, or J policies, is very similar to available survey estimates of Medicare beneficiaries who report individual Medigap coverage for prescription drugs – about 40 percent (Poisal and Murray, 2001).

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Most policyholders in either standard or pre-standard plans held individual policies, but prestandard policyholders were more likely to be in group plans than were standard policyholders. In 1999, 35 percent of pre-standard policyholders were in group policies, compared to just 20 percent of standard policyholders. Many group pre-standard policies may be the product that AARP sold before 1992.11 That product provides very limited coverage for prescription drugs: a $50 deductible, 50% coinsurance and a $500 limit on covered drug expenses. In 1999, the distribution of policyholders between standard and pre-standard policies varied widely across states (see Table 3). In four states (California, Connecticut, Maryland, and New Jersey) more than half of Medigap policyholders were in pre-standard plans, and (except in Maryland) usually in pre-standard group plans. Conversely, in six states (Alabama, Arkansas, Idaho, Maine, North Dakota and Utah), fewer than 15 percent of policyholders were in pre-standard plans.

3.

Enrollment in Alternative Standard Policy Forms As described above, Medigap insurers have been allowed to issue only 10 standard policy forms

since 1992. Policy form A includes only the standard Abasic benefits@ that are common to all Medigap policies. 12 The most popular policy forms are F, C, and B. 13, 14 These three policy forms accounted for 48 percent of all Medigap policyholders in 1999, and 76 percent of all standard policy holders (see Table 4). On the whole, individual policyholders (54 percent) were more likely to have one of these three policies than were group policyholders (31 percent).

11

Gerry Smolka, AARP Public Policy Institute, personal communication, June 2001.

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These are: Part A coinsurance, plus coverage for 365 additional days of hospitalization after Medicare benefits end; Part B coinsurance (generally 20 percent of Medicare-approved expenses) or, in the case of hospital outpatient services under a prospective payment system, applicable copayments; and the first three pints of blood each year. 13

In addition to core benefits, policy form F covers Medicare=s Part A and Part B deductibles, all Part B excess charges, and SNF coinsurance, and may be sold with no deductible or with a high deductible. Policy form F also pays for emergency covered services during foreign travel; but it does not cover home health care, preventive services or prescription drugs. Policy form F=s high-deductible option includes a deductible of $1,530 per year for covered expenses net of the plan=s separate foreign travel emergency deductible. 14

Compared to policy form F, policy form C does not cover Part B excess charges, and there is no highdeductible option.

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Notably, fewer than 6 percent of all Medigap policyholders – and just 9 percent of standard policyholders – were in any of the standard policy forms (H, I or J) that cover prescription drugs (see Table 5).15, 16 That is, of all Medicare beneficiaries who have bought a Medigap policy since 1992 (and retained it into 1999), 9 percent bought any policy that covers prescription drugs. While F, C and B plans account for nearly half of Medigap enrollment nationwide, in Alabama and North Dakota more than 90 percent of Medigap policyholders were in these policy forms (see Table 6). In Alabama, 76 percent were in B plans; and in North Dakota, 85 percent were in F plans. However, in four states – California, Connecticut, Delaware and Hawaii – and in the District of Columbia, fewer than one third of all Medigap policyholders were in F, C or B policy forms.17 The reasons for this apparently vary. In California, Connecticut and in the District of Columbia, enrollment in pre-standard policies was unusually high (41 to 67 percent of total enrollment). In Delaware and Hawaii, other standard policy forms (D and A, respectively) accounted for unusually high proportions of Medigap coverage. Reflecting low rates of drug coverage among standard Medigap policyholders nationally, this coverage is rare among standard policyholders in nearly every state. Only in Alaska, New York and Vermont were as many as 15 percent of Medigap policyholders in standard H, I or J plans in 1999 (see Table 7). In Vermont, nearly 28 percent of policyholders had standard drug coverage, a rate that greatly exceeded that in any other state. But in Alabama and North Dakota, only about 1 percent of Medigap policyholders were enrolled in standard plans that covered prescription drugs. That is, in these two states, only about 1 percent of all Medigap policies purchased and then renewed during the last decade covered

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In addition to the basic benefits, policy forms H, I and J all cover skilled nursing coinsurance and foreign travel emergency services. Policy forms H and I cover prescription drug expenses up to $1,250 per year. Policy form J covers prescription drug expenses up to $3,000 per year, and also the Part B deductible and preventive care. 16

Massachusetts, Minnesota and Wisconsin regulate Medigap plans under a waiver of Federal law; each has a different set of standard policy options. In Massachusetts, one of three standard policies covers drugs. In Minnesota, drug coverage is sold either as an optional rider to the basic policy, or as a covered expense in extended basic policies. In Wisconsin, the basic benefit covers drugs with a $6,250 drug deductible, and additional drug coverage may be purchased as an optional rider. Enrollment and premium data for standard policy forms unique to these states are not available from NAIC. 17

In the three states that operate under waivers of federal law standardizing benefits – Massachusetts, Minnesota and Wisconsin, enrollment in most standard policy forms probably includes only policyholders who moved to these states and retained a standard policy issued in another state.

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prescription drugs. In 25 states (including the three waivered states) fewer than 5 percent of Medigap standard policyholders had coverage for prescription drugs. If we assume that half of all pre-standard policies may have some coverage for prescription drugs – probably a high estimate – the picture for Medigap policyholders is brighter in some states, but not most.18 In nine states19 and the District of Columbia, about one third of Medigap policyholders may have had coverage for prescription drugs in 1999. However, in Alabama, North Dakota, Arizona and Idaho, fewer than ten percent may have had any drug coverage; and in all but six states, at least half of all policyholders who may have had any coverage for prescription drugs would have been holding pre-standard policies issued before 1992. Nationwide, 3 of every 4 Medigap policyholders with coverage for prescription drugs in 1999 would have been enrolled in a pre-standard Medigap plan – and would have been age 72 or older. The following sections examine patterns of enrollment and prices specifically in the individual market, which contained 75 percent of all Medigap policyholders in 1999. We first look at enrollment in open policies as an indication of the choices available to Medicare beneficiaries at age 65. We then turn to enrollment in guaranteed issue plans and in plans that accept disabled Medicare beneficiaries. Enrollment in these plans is a useful indicator of the plan choices available, respectively, to Medicare beneficiaries older than 65 who have health problems and to disabled Medicare beneficiaries.

4.

Individual enrollment in open products Most insurers in the Medigap market offer products that are open to new enrollment. However,

many insurers run only closed products – that is, they renew coverage but do not issue new coverage – in some or all policy forms. Enrollment in open products is an important measure of a state=s Medigap market for at least two reasons. In markets with a greater variety of open products, Medicare beneficiaries may have greater choice among policy forms (at least at age 65 when all Medigap policies are guaranteed issue). All else 18

By assuming that all pre-standard policies include some coverage for prescription drugs, insurers’ reported covered lives very nearly matches estimates of prescription drug coverage among Medicare beneficiaries, as measured by the Medicare Beneficiary Survey (Poisal and Murray, 2001). However, earlier research (Rice et al., 1997) examining prestandard Medigap policies issued in six states, suggests that the rate of prescription drug coverage in Medigap plans before standardization (in 1991) was as low as 13 percent. An estimate of 50 percent here would be consistent with bias in the retention of pre-standard policies, favoring retention of policies that covered prescription drugs. Many (if not most) of these policies may provide lower levels of drug protection than standard policies and, therefore, on an age-rated basis would be less expensive than standard policies. 19

Alaska, California, Connecticut, Maryland, New Jersey, Vermont, Virginia, and Washington.

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being equal, greater enrollment in open products also may indicate that these products are actively marketed and relatively easy for consumers to find. (As discussed in a later section, many insurers do not actively market their open products.) Conversely, high enrollment in closed products suggests that Medigap insurers may be having serious problems. Insurers generally will close a product when its cost experience is deteriorating, and therefore, premiums are rising steeply. In such a situation, insurers fear an adverse selection spiral (sometimes called a “death spiral”) – a phenomenon in which rising premiums discourage healthy policyholders from maintaining coverage, and the higher cost experience of remaining policyholders drives still higher premiums. Insurers experiencing adverse selection may close their insurance products to new enrollment, and in the direst cases they may cancel policies and exit the market. However, because the Medigap market is so extensively underwritten, it is unlikely that any state regulator would allow a Medigap insurer to cancel policies without guaranteeing that another insurer would accept all policyholders without a steep premium increase. The difficulty (and expense) of such guarantees apparently holds most Medigap insurers in the market, even though all or most of their products are closed. Including enrollment in pre-standard policy forms (which have been closed to new enrollment since 1992), fewer than half of individual Medigap policyholders (48 percent) were enrolled in open products in 1999 (see Table 8). Including only policyholders in standard policies, just two-thirds (68 percent) were in open products. On average, a low percentage of enrollment in policy forms that cover prescription drugs (H, I and J) were in open products, despite the apparent determination of regulators in most states to maintain at least one open H, I or J product. In 1999, just 21 percent of enrollees in H policies (presumably the most affordable Medigap drug plan) were in open products, and only about half of enrollees in I and J policies were in open products. These rates compared to a nationwide average of 79 percent of F policyholders – the most popular standard policy form – in open products. The relatively low rate of enrollment in open H products nationally reflects extremely low rates of enrollment in open products (and relatively high rates of enrollment in closed products) in eight states: Arizona, Maine, New Hampshire, New York, North Carolina, Pennsylvania, Utah and Vermont. In each of these states, fewer than 5 percent of H policyholders were in open products. In many states, the percentage of Medigap policyholders in open products is surprisingly low across all policy forms. In 21 states, fewer than half of all individual policyholders were enrolled in open products, 9

standard or pre-standard. Considering only standard policy forms, fewer half of policyholders were in open products in twelve states.20 In Maine and Montana, fewer than 10 percent of all policyholders were enrolled in open products; and in Maine’s standard Medigap market, just 7 percent were in open products.

5.

Individual enrollment in products that are guaranteed issue or accept disabled Very little of the individual Medigap market, nationally or in most states, is guaranteed issue except

at age 65. In 1999, just 12 percent of Medigap policyholders in any individual plan (open or closed, standard or pre-standard) were enrolled in open products that guaranteed issue after age 65 (see Table 9). Among policyholders enrolled only in standard policy forms, just 18 percent were in guaranteed-issue products. Even these low numbers, however may reflect reporting error, and should be considered high estimates of enrollment in guaranteed-issue products.21 Policy forms that offer coverage of prescription drugs (weighted by enrollment) were much less likely to guarantee issue after age 65. Fewer than 3 percent of H or I enrollees, and just 11 percent of J enrollees, were in guaranteed-issue products in 1999. Overall, Medigap policies that accept disabled Medicare beneficiaries are even rarer than products that are guaranteed-issue after age 65. In 1999, just 11 percent of Medigap policyholders (elderly or disabled) were in open products that accepted disabled beneficiaries. Among policyholders in standard policy forms, just 16 percent were in products that accepted disabled beneficiaries. However, policies that cover prescription drugs were more likely to accept disabled than to be guaranteed issue after age 65. In 1999, 15 percent of H and I policyholders, and 9 percent of J policyholders, were in products that accepted disabled Medicare beneficiaries. The proportion of individual Medigap policyholders enrolled in guaranteed-issue products is presented by state in Table 10. In 38 states and the District of Columbia, less than 10 percent of enrollment in standard policy forms was guaranteed-issue in 1999. Conversely, in four states C Connecticut, Illinois, Kansas and New York C more than two-thirds of enrollment in standard policy forms were guaranteed20

Alabama, Hawaii, Maine, Montana, New Hampshire, New Jersey, North Carolina, North Dakota, Pennsylvania, Utah, Vermont and Washington. 21

Some insurers may have misconstrued this question and indicated that the product was guaranteed issue to some applicants (Mary Beth Senkewicz, personal communication). All standard Medigap policy forms are guaranteed issue to Medicare beneficiaries within 6 months of initial enrollment in Part B.

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issue. In general, these higher rates corresponded to very high rates of guaranteed-issue enrollment in policy form F and (in all states but New York) also in A. In New York, 72 percent of individual enrollment in standard policy forms was guaranteed-issue; and nearly all enrollment in policy forms B, D, and G was guaranteed issue. The differences among states in guaranteed-issue Medigap enrollment probably relate to differences in regulatory practice – either statutory or informal. However, no available study has attempted to document differences in state regulatory practice. While enrollment in standard policy forms that cover prescription drugs is uniformly low, in some states, these policy forms are often guaranteed-issue. In seven states,22 at least 40 percent of enrollment in either H or I policy forms was guaranteed-issue in 1999 – including Hawaii and New Jersey, where all enrollment in H policies was guaranteed-issue. Policy holders in J plans are rare, and guaranteed issue policyholders rarer still, but in 4 states (Mississippi, New Jersey, Texas and Vermont) more than threefourths of enrollees in J policies were guaranteed issue in 1999; in New Jersey and Vermont, all J enrollment was guaranteed issue.

D.

MEDIGAP INSURERS The following sections describe the structure of supply in the Medigap market. We review the

number of insurers with individual policies in force, and also the number of active insurers C those who have sold Medigap policies recently. All of the information presented below indicates the availability of insurance at the state level. There is no source of information that would indicate whether an insurer restricts its business to only some areas of the state, although many insurers may do so.

1.

Number of Insurers In every states, there are many insurers with policies in force. In 1999, the Aaverage@ state had 43

insurers with group policies in force and 147 insurers with individual policies in force (see Table 11). In both markets, many insurers appeared to be writing coverage in the state only because they were licensed there and were renewing coverage for a single policyholder who had moved there. The ability of insurers to survive in the Medigap market while writing very few lives in many of the states in which they maintain policies allows for considerable variation among states in the number of 22

Hawaii, Idaho, Missouri, New Hampshire, New Jersey, New Mexico and Virginia.

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insurers per covered lives.23 For example, Hawaii C with just over 3,000 covered lives in its Medigap market C had 82 insurers with individual policies in force and 40 insurers with group policies in force. In the individual market, Hawaii had more than twice the rate of insurers as Alaska and six times the average across all states.

2.

Number of Active Insurers The NAIC reporting form asks insurers to identify how many of the policies they have in force were

newly issued during the three years ending with the reporting year. Table 12 identifies in each state the number of insurers that were active between 1997 and 1999. These insurers are a subset of insurers with open products. Averaged across the states, fewer than half of insurers in either the group market (45 percent) or the individual market (49 percent) in 1999 reported having sold a new policy since 1997. The proportion of Medigap insurers that were active varied widely among states. In the group market, the percent of insurers that were active ranged from just 20 percent in Massachusetts and the District of Columbia, to more than 60 percent in Mississippi, Nebraska and South Carolina. In the individual market, the percent of insurers that were active ranged from 27 percent in New Jersey and Massachusetts to 68 percent in Rhode Island. In general, states with more insurers overall had a lower percentage of insurers actively marketing policies, especially in the group market.24 The following two sections focus specifically on the structure of insurers in the individual market, which covers 7 in 10 Medigap policyholders nationwide. We consider the number of insurers with open products across policy forms nationally and by state, as well as the number of insurers that offer guaranteed issue products or accept disabled Medicare beneficiaries.

3.

Insurers with Open Products in the Individual Market In 1996, most insurers ran open products, and most policy forms were available in every state (if

not in every locale within the state). Averaged across policy forms and states, 86 percent of insurers ran 23

The statistical correlation between the number of insurers writing coverage and the number of covered lives is only moderate in the group Medigap market (0.32), but stronger in the larger individual market (0.51). 24

The statistical correlation between the proportion of insurers that actively sold coverage and the number of insurers with policies in force was negative in both the group market (-0.49) and in the individual market (-0.07). The lower likelihood that group insurers would actively market in states may indicate a greater reluctance among group insurers to market actively in states where they have only a very small base of business.

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open products in 1999 (see Table 13), although many of these insurers were not actively marketing. The two most popular policy forms nationally C respectively, F and C C also corresponded to the greatest number of insurers with open products. However, insurers writing these policy forms were about as likely to be running open products as insurers writing other policy forms. Among the states, the percent of insurers with open products, averaged across policy forms, varied from a high of more than 25 insurers in Florida, Illinois, Ohio, Oregon and Texas, to fewer than 5 insurers in Hawaii and New York. Adjusted for covered lives, the greatest number of insurers with open products (again averaged across policy forms) were in Alaska, Hawaii, Rhode Island and the District of Columbia. The fewest insurers with open products relative to the number of covered lives were (among states with standard policy forms) in New York and Pennsylvania.

4.

Insurers with Guaranteed-Issue Products in the Individual Market Only about 17 percent of the insurers that ran open products in the individual market in 1999

offered any products guaranteed-issue. As many as a third of insurers selling policy forms H, E and J offered guaranteed-issue products – a higher rate than in any of the other standard policy forms (see Table 14). However, few Medigap policyholders were enrolled in H, E, and J policies in 1999. The percentage of insurers that offered any products guaranteed-issue varied markedly by state, generally reflecting the state-to-state differences in guaranteed-issue enrollment that were noted earlier. In New York, more than 80 percent of insurers (averaged across policy forms) offered at least some policy forms guaranteed issue (see Table 15). In Minnesota, 61 percent offered at least some policy forms guaranteed issue. However, in all other states, fewer than half of insurers offered guaranteed-issue products; and in 30 states, fewer than 20 percent offered guaranteed-issue products. In Nebraska and South Dakota, just 1 or 2 insurers (fewer than 12 percent) offered any policy form guaranteed issue. Not surprisingly, the number of insurers with guaranteed-issue products, averaged across policy forms, was greatest in states with larger numbers of insurers (and population size) overall, although in general lower proportions of insurers offered guaranteed-issue products in those states.25 In Florida, Texas,

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The Pearson correlation between the number of individual insurers with guaranteed issue products in the state and the proportion of all insurers offering guaranteed issue in 1999 was -0.19.

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Louisiana and Illinois – states with many Medigap insurers –at least 5 insurers offered guaranteed-issue products in at least one policy form.

E.

PREMIUMS IN THE INDIVIDUAL MARKET Medigap premiums in the individual market averaged $1,316 per year in 1999, for both open and

closed products (see Table 16). Premiums varied markedly between standard and pre-standard policies, across standard policy forms, and from state to state. Among states with standard Medigap products, and averaged across all policy forms, Medigap policyholders in California, Florida and Indiana paid more than $1,600 per year for coverage. Conversely, in New Hampshire, Pennsylvania and Utah, Medigap policyholders paid less than $900 per year. In Montana, policyholders paid an average annual premium of just $244 in 1999. Obviously, some of the difference in average premiums across states relates to differences in the policy forms that policyholders select (for example, F and C policies are quite inexpensive in Montana). In turn, differences among states in the average price of a policy form may relate to demographic differences in the covered populations – such as average age – that are not observable in the data reported by insurers. However, average premium differences may also relate to a failure of competition to control local Medigap prices, as has been noted elsewhere.26 For policy form A (the basic benefit), average annual premiums varied as much as threefold from state to state. Average premiums for A policies in Montana, New Hampshire, and Idaho were less than $350 per year. But in Alabama, California, Florida, Louisiana, Missouri, Texas and the District of Columbia, average premiums for A policies were more than $1,000 per year. Average premiums for standard policy forms that cover prescription drugs C H, I or J C typically ranged higher than $1,000 per year, nationally about 35 percent higher than the average premium for standard coverage that did not pay for prescription drugs. In sixteen states,27 policyholders on average paid

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Weiss Ratings, Inc. (1999) reported standard rates for plan A for a man at age 65 in Bakersfield, CA that varied from $496 (quoted by Labor Union Life) to $1,220 (quoted by Bankers Life and Casualty Company). In Billings, MT rate quotes for a J plan (again for a man at age 65) included $1,518 (Blue Cross Blue Shield of MT) and $3,453 (National States Insurance Company). 27

Alabama, Arkansas, Arizona, California, Florida, Georgia, Iowa, Illinois, Louisiana, Missouri, Mississippi, New York, Ohio, Pennsylvania, South Dakota, and Tennessee.

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at least $2,000 per year for a standard policy that covers prescription drug, and (in Arizona and South Carolina) as much as $3,600 for the more extensive standard (J) drug coverage. Finally, the difference between average premiums in pre-standard and standard policies undoubtedly contributes to pre-standard policyholders’ apparent reluctance to move into standard policy forms, even if they were able to pass insurers’ underwriting screens. In all but three states (Connecticut, Maryland and New York), pre-standard premiums were less than premiums for standard products, averaged across all standard policy forms. In three states C Indiana, North Carolina and New Hampshire C average standard premiums were at least $1,000 per year higher than average standard premiums in 1999. However, in most states (all but fifteen), the average premium for pre-standard Medigap policies exceeded the average premium for standard coverage that included prescription drugs – in New Hampshire, by more than $1,300. Higher average prices for pre-standard coverage (which probably offer less, if any, coverage for prescription drugs than the standard H, I, or J coverage) may reflect underwriting barriers that prevent pre-standard policyholders from moving to standard coverage. However, higher pre-standard prices probably also reflect the older average age of policyholders in pre-standard plans.

F.

CHANGES IN ENROLLMENT AND PREMIUMS FOR MEDIGAP POLICIES The standard report that insurers file with each state provides information about Medigap policies in

force that were first issued in the last three years and, separately, about policies in force first issued in any prior year. The information presented in this section is based on tabulations of that information – distinguishing old from more recent business in 1999, and also on a comparison of 1999 policies in force with comparable information reported in 1997. Together, these tabulations offer a picture of how the Medigap market changed between 1997 and 1999. However, because the insurer reports that underlie the NAIC data are unaudited, changes measured across years should be regarded as suggestive, not definitive. The following sections present information about new issue in the group and individual Medigap markets; the net change in covered lives in the larger, individual segment of the market; and the change in average premiums for all Medigap policies between 1997 and 1999.

15

1.

Group Versus Individual Enrollment While the vast majority of Medigap policyholders are in individual plans, enrollment in group policies

accelerated between 1997 and 1999. During that period, 40 percent of all newly issued (and subsequently renewed) policies were group policies, compared to just 14 percent of policies that were issued before 1997 (see Table 17). As a result, 70 percent of group policies in force in 1999 were recently issued, compared to just 37 percent of individual Medigap policies. Nevertheless, insurers continued to issue approximately three individual policies for every two group policies that they issued. Various factors may drive new issue in either the individual or group market: enrollees may change plans or carriers within the individual or group market, they may move between markets, and new Medicare beneficiaries may enter either market. Thus, a number of factors may favor new issue in the group market relative to new issue in the individual market. For example, new Medicare beneficiaries may have preferred enrollment in group plans, driving up recent issue in the group market faster than in the individual market. But Medicare beneficiaries in the individual market also may be more cautious than group plan administrators, and therefore less likely to change Medigap policies after age 65. Finally, insurers may be more fearful of adverse selection in the individual market and, therefore, more likely to entry-age rate individual policies. In general, entry-age rating deters policyholders from changing plans – either within the individual market or by moving into the group market.

2.

Individual Enrollment in Alternative Policy Forms Despite significant rates of new issue in the individual market, reported enrollment in individual

policies declined markedly between 1997 and 1999, both in standard and pre-standard policy forms (see Table 18). In 1999, insurers reported 22 percent fewer covered lives in individual policies than in 1997, including a drop of nearly 30 percent in covered lives in pre-standard policy forms. The larger decline in pre-standard covered lives is consistent with the older ages of pre-standard policyholders; in 1999, all prestandard policyholders were at least age 72. Net enrollment in the most popular standard policy form (F) increased 6.5 percent between 1997 and 1999. However, net enrollment in two other relatively popular policy forms (C and B) declined substantially (respectively, 22 percent and 35 percent). In standard plans that cover prescription drugs, net enrollment declined 60 percent – driven largely by an 83-percent decline in enrollment in policy form H. At least some of the decline in individual H enrollment might be attributable to the acceleration of 16

Medicare+Choice enrollment in many markets. A rising majority of Medicare+Choice plans offered prescription drug coverage during that period, most with zero premium.28

3.

Premiums for Individual Medigap Policies Between 1997 and 1999, average premiums increased for every policy form (see Table 18).

Averaged nationwide, the changes were modest – varying between a half-percent (for G policies) and 3 percent (for H policies) nationwide. Average premiums for F policies increased just 1 percent. However, these modest averages hide much larger changes in average premiums at the state level. Viewed state by state, the median change in average premiums for F policies between 1997 and 1999 was more than 14 percent; for H policies, the median change in average premiums was 15 percent. Ironically, the fastest growth was for the narrowest coverage, which presumably appeals to the lowest-income Medicare beneficiaries: the median increase in premiums for A or B coverage was 20 percent and 23 percent, respectively.

G.

SUMMARY AND IMPLICATIONS FOR MEDICARE Little information has been available about the details of coverage in the Medigap market. Indeed,

the only source of detailed information about this market comes from insurer reports, and historically these reports have not been analyzed to provide a picture of this market. This paper uses those reports for 1999 and 1997 to compile a picture of coverage in the Medigap market and a sense of how this market is changing. These data document various major features of the Medigap market:

28



Pre-standard Medigap policies account for a significant share of the Medigap market: in 1999, one-third of all Medigap policies in force were pre-standard.



The most popular standard policy forms continue to be F, followed by C and B. Combined enrollment in these standard policy forms accounted for 48 percent of all Medigap enrollment in 1999.

Gold, M. (July/August 201). “Medicare+Choice: An Interim Report Card.” Health Affairs 20(4): 120-138.

17



Very few Medicare beneficiaries are enrolled in standard policy forms that cover prescription drugs (H, I or J). In 1999, fewer than 6 percent of Medigap policyholders were enrolled in these policy forms. By inference, only 6 percent of all Medigap purchasers since 1992 selected and retained a policy that covered prescription drugs.



Most Medigap policyholders buy coverage in the individual market, not through associations. In 1999, individual policyholders accounted for 75 percent of all Medigap policyholders.



Many Medigap policyholders are in closed products that are not enrolling new members. In 1999, 32 percent of standard policyholders nationwide were in closed policy forms. In 12 states, more than half of standard policyholders were in closed products. A high proportions of enrollment in closed products may indicate problems of access to Medigap coverage and a narrowing of choice among insurers and policy forms.



Nationwide, guaranteed-issue Medigap policies are rare. In 1999, just 12 percent of all Medigap policyholders were enrolled in guaranteed issue standard products. Medigap products that accept disabled beneficiaries are rarer still, accounting for just 11 percent of Medigap enrollment in 1999.



In every state, many insurers offered Medigap coverage, but many covered just a few policyholders. Moreover, even among insurers with significant business, many ran only closed products or were inactive – reporting no new issues in the last several years. In 1999, fewer than half of all Medigap insurers ran open products and were active.



Only 17 percent of insurers that ran open Medigap products in 1999 offered any product guaranteed issue to Medicare beneficiaries older than age 65. Among insurers running open F products, only 10 percent offered it guaranteed-issue.



Insurers that ran guaranteed-issue H products were relatively common among those with open products (38 percent), suggesting an effort by state regulators to maintain access to minimal drug coverage in the Medigap market.



Average premiums in the individual Medigap market in 1999 were high: $1,316 nationwide. Moreover, average premiums – overall and within policy forms – varied substantially from state to state; for policy form A, as much as three-fold.



Average premiums for policy forms that covered prescription drugs typically ranged above $1,000 per year, and in 16 states exceeded $2,000 per year. Nationally, these policies were priced about 35 percent higher than standard policy forms that did not cover prescription drugs.

18



It appears that the Medigap market is changing rapidly. Between 1997 and 1999, the rate at which new issue of group policies were issued greatly exceeded that of individual policies – although most new issues were individual policies. Insurers also reported many fewer covered lives in the individual market in 1999. Individual enrollment in standard policies that cover prescription drugs dropped most precipitously (60 percent), driven largely by declining enrollment in H plans. This trend may relate to rising Medigap+Choice enrollment during those years.



Average premiums for individual Medigap coverage appear to be volatile. Averaged across all states, the 1997-1999 growth in average premiums in every policy form was modest – ranging from less than one percent to about 3 percent, depending on the policy form. However, viewed at the state level, premium changes were much more dramatic: median premium changes ranged from less than 1 percent (in policy form J, where enrollment typically is very low) to more than 23 percent in policy form B. The median increase in average pre-standard premiums was nearly 16 percent.

While the Medigap market is very complex – and different for policyholders in different states and even different communities within states, several general lessons for policymakers concerned about this market and its relationship to Medicare seem apparent. First, the rules that govern the Medigap market appear virtually to eliminate competition, especially for Medigap policyholders after age 65 but also even at age 65 when all open products are guaranteed issue. As a result, competitive patterns of price and coverage often fail to emerge. In short, it appears that many consumers pay high prices for standard coverage when lower prices are available to them or to others. If Medigap coverage represented only a marginal supplement to ample Medicare benefits, failure of competition in this market might be overlooked. However, Medigap policyholders pay significant premiums for coverage and, where Medicare+Choice plans are unavailable to them, have no other option for achieving the overall insurance protection that is widely available to the nonelderly population in either employer-based or individual plans. Thus failure of competition in the Medigap market would seem to merit far more consideration by policymakers than it has received. Second, the very low take-up of standard Medigap coverage that covers prescription drugs is problematic. Among all Medicare beneficiaries who purchased and renewed Medigap coverage between 1992 and 1999, fewer than 6 percent bought a Medigap policy that covered prescription drugs. If most pre-standard Medigap policies provide some coverage for prescription drugs (as would be inferred from population survey data), then 4 of every five Medigap policyholders with prescription drug coverage in 1999 were in pre-standard policies. Because all pre-standard policyholders are now over age 74, this 19

pattern suggests that drug coverage among Medigap policyholders will decline precipitously in the coming years – as policyholders with pre-standard coverage die. The failure of drug coverage in the Medigap market probably poses the greatest dilemma for the Medicare beneficiaries and the Medicare program in the near term – increasingly compromising beneficiaries’ access to reasonable care and distorting their use of Medicare-covered services. Finally, the complexity of the Medigap market and the considerable variation in these markets from state to state offer lessons to federal policymakers interested in Medicare reform that would make all or some Medicare coverage private and competitive. Most states have adopted only the NAIC guidelines for regulation of Medigap coverage, and with few exceptions state policy makers have not paid particular attention to how the Medigap market serves the most vulnerable Medicare beneficiaries. Whether state Departments of Insurance have the capacity to oversee products and rates in a private Medicare market, and what additional resources they would require to do so, are questions yet to be addressed in discussions of Medicare reform. Moreover, it is unclear how a private Medicare market would support choice and competition, when most private insurers have survived in the Medigap market only with extensive underwriting and pricing barriers to competition. As one preview of a private Medicare market, the Medigap market offers a menu of difficult questions yet to be addressed.

References

National Association of Insurance Commissioners (November 30,2000). Medicare Supplement Insurance Issue Paper. Prepared by the Accident and Health Working Group of the Life and Health Actuarial Task Force (www.naic.org). Poisal, J.A. and G. S. Chulis (March/April 2001). “Growing Differences Between Medicare Beneficiaries With and Without Drug Coverage.” Health Affairs 20:2, 74-85. Rice, T., M.L. Graham, P.D. Fox (Summer 1997). “The Impact of Policy Standardization on the Medigap Market,” Inquiry 35: 106-116.

20

Figure 1

Covered Lives by Policy Type, 1999 7.2% 27.6%

47.1% 18.0%

Pre-1977 group policies

Pre1997 individual policies

1997-99 group policies

1997-99 individual policies

Source: Authors' tabulations of 1999 NAIC data.

TABLE 1

NUMBER OF COVERED LIVES IN MEDIGAP POLICIES AND PERCENT IN GROUP OR INDIVIDUAL PLANS BY STATE, 1999

States Ranked by Percent in Individual Plans MD AL SD OR KS LA DC WV AR DE FL GA WY OK AK MT MN RI ND MS NV WA NE IL KY IA ID UT WI MO SC ME VA NC PA IN TN TX CO MI CT NH VT OH NY AZ

Total Covered Lives (in thousands) 113.5 219.2 71.9 89.7 189.0 125.7 5.0 74.4 156.7 17.4 591.9 207.3 26.3 96.1 6.0 256.3 84.1 6.5 65.1 128.6 33.2 158.8 140.3 543.8 203.6 276.3 59.3 76.9 258.4 297.8 167.6 94.6 268.8 348.9 867.5 304.0 129.6 468.4 76.0 123.3 206.7 43.8 32.0 329.8 398.3 89.0

Percent in Individual Policies 99.3% 98.6% 98.3% 98.3% 98.2% 97.9% 97.3% 97.1% 96.7% 96.5% 95.5% 95.2% 95.2% 95.1% 95.1% 95.0% 94.8% 94.3% 93.2% 92.5% 92.0% 91.6% 89.6% 87.7% 87.3% 85.8% 83.5% 80.5% 79.9% 76.8% 73.7% 73.6% 73.5% 73.0% 72.8% 67.2% 66.7% 66.1% 64.1% 64.0% 61.4% 60.0% 55.7% 53.0% 52.7% 46.1%

Percent in Group Policies 0.7% 1.4% 1.7% 1.7% 1.8% 2.1% 2.7% 2.9% 3.3% 3.5% 4.5% 4.8% 4.8% 4.9% 4.9% 5.0% 5.2% 5.7% 6.8% 7.5% 8.0% 8.4% 10.4% 12.3% 12.7% 14.2% 16.5% 19.5% 20.1% 23.2% 26.3% 26.4% 26.5% 27.0% 27.2% 32.8% 33.3% 33.9% 35.9% 36.0% 38.6% 40.0% 44.3% 47.0% 47.3% 53.9%

TABLE 1 (cont'd) States Ranked by Percent in Individual Plans

Total Covered Lives (in thousands)

Percent in Individual Policies

Percent in Group Policies

NM HI MA NJ CA Total, all states

37.8 6.9 38.8 450.2 246.3 9307.7

45.3% 44.3% 43.0% 33.3% 31.6% 75.7%

54.7% 55.7% 57.0% 66.7% 68.4% 24.3%

Source: Authors' tabulations of 1999 NAIC data.

TABLE 2 NUMBER AND PERCENT OF COVERED LIVES IN STANDARD AND PRESTANDARD POLICY FORMS BY PLAN TYPE, 1999

Policy Form Other

Plan Type

Standard

Pre-standard

Individual Group Total

4.8 1.2 5.9

2.0 1.1 3.1

Individual Group Total

80.5% 19.5% 100.0%

Percent within Policy Form: 65.3% 86.8% 34.7% 13.2% 100.0% 100.0%

75.7% 24.3% 100.0%

Individual Group Total

67.7% 51.0% 63.7%

Percent within Plan Type: 28.6% 3.7% 47.3% 1.7% 33.2% 3.2%

100.0% 100.0% 100.0%

Source: Authors' tabulations of 1999 NAIC data.

Covered Lives (in millions): 0.3 0.0 0.3

Total

7.0 2.3 9.3

TABLE 3

NUMBER AND PERCENT OF COVERED LIVES IN STANDARD AND PRESTANDARD POLICY FORMS AND PERCENT IN INDIVIDUAL PLANS BY STATE, 1999

State AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IN KS KY LA MA MD ME MI MN MO MS MT NC ND NE NH NJ NM NV NY OH OK OR PA RI SC SD TN

Covered Lives (in thousands) 4.2 207.3 93.1 60.7 120.8 49.0 68.8 3.0 13.1 380.4 151.6 5.3 175.0 50.9 351.0 207.5 141.6 122.6 78.5 15.6 54.3 83.1 85.8 43.9 170.7 91.5 181.3 239.3 60.4 85.7 35.1 219.6 22.8 23.0 316.3 195.8 63.2 55.9 652.7 4.5 116.6 46.5 89.7

Standard Policy Forms Percent of all Percent in Covered Lives Individual Plans 69.9% 94.5% 94.5% 98.8% 59.4% 95.0% 68.2% 52.1% 49.1% 33.3% 64.5% 69.6% 33.3% 62.4% 59.5% 98.1% 74.8% 97.3% 64.3% 94.9% 73.1% 94.8% 77.0% 52.5% 63.3% 85.8% 85.8% 88.2% 64.5% 94.4% 68.2% 64.8% 74.9% 99.4% 60.2% 97.8% 62.5% 99.3% 40.1% 93.2% 47.8% 99.3% 87.8% 82.3% 69.6% 72.0% 52.2% 99.8% 57.3% 79.0% 71.2% 92.1% 70.7% 95.8% 68.6% 77.1% 92.8% 94.5% 61.1% 92.3% 80.2% 67.3% 48.8% 24.6% 60.3% 43.2% 69.5% 91.1% 79.4% 61.6% 59.4% 47.5% 65.7% 95.0% 62.3% 98.7% 75.2% 90.5% 69.6% 94.1% 69.6% 77.6% 64.6% 99.6% 69.2% 72.6%

Pre-standard Policy Forms Covered Lives Percent of all Percent in (in thousands) Covered Lives Individual Plans 1.8 30.0% 96.4% 12.0 5.5% 94.9% 20.6 13.1% 97.4% 28.1 31.6% 32.9% 125.2 50.9% 29.9% 26.9 35.4% 53.9% 137.9 66.7% 60.9% 2.0 40.5% 96.3% 4.4 25.1% 94.1% 210.8 35.6% 96.7% 55.7 26.9% 96.4% 1.6 22.9% 16.5% 101.0 36.6% 85.8% 8.4 14.1% 55.1% 192.6 35.4% 75.4% 96.4 31.7% 72.5% 45.0 23.8% 99.3% 81.0 39.8% 71.3% 47.0 37.4% 95.5% 13.5 34.7% 16.0% 59.2 52.2% 99.3% 11.6 12.2% 11.2% 37.4 30.3% 45.4% 36.6 43.5% 98.0% 127.0 42.6% 73.8% 37.0 28.8% 93.5% 74.8 29.2% 92.9% 109.4 31.4% 63.7% 4.6 7.1% 76.3% 53.7 38.3% 85.2% 8.7 19.8% 30.5% 230.6 51.2% 41.5% 15.0 39.6% 48.4% 10.0 30.2% 93.9% 82.0 20.6% 18.6% 133.6 40.5% 60.9% 32.8 34.2% 95.2% 33.8 37.7% 97.5% 214.7 24.8% 18.9% 2.0 30.4% 94.6% 51.0 30.4% 64.6% 25.2 35.1% 95.8% 39.8 30.7% 53.3%

TABLE 3 (Cont'd)

State TX UT VA VT WA WI WV WY Total

Standard Policy Forms Covered Lives Percent of all Percent in (in thousands) Covered Lives Individual Plans 325.4 68.6 150.1 25.9 107.4 158.9 41.8 17.9 5,925.2

69.5% 89.2% 55.8% 81.0% 67.6% 61.5% 56.2% 68.1% 63.7%

76.4% 86.4% 73.9% 62.5% 88.9% 99.3% 96.9% 94.0% 80.5%

Pre-standard Policy Forms Covered Lives Percent of all Percent in (in thousands) Covered Lives Individual Plans 142.7 8.3 118.7 6.1 51.2 75.9 32.6 8.3 3,086.1

30.5% 10.8% 44.2% 19.0% 32.2% 29.4% 43.7% 31.5% 33.2%

Source: Authors' tabulations of 1999 NAIC data. Note: Because covered lives in "other" policy forms are omitted, percentages do not add to 100 percent.

42.5% 31.5% 73.0% 27.0% 97.2% 64.0% 97.5% 97.7% 65.3%

TABLE 4 NUMBER AND PERCENT OF COVERED LIVES IN MEDIGAP POLICIES BY STANDARD POLICY FORM AND PLAN TYPE, 1999

Plan type

A

Individual Group Total

136.3 125.6 261.9

Individual Group Total

Individual Group Total

B

C

D

708.8 1,181.0 315.9 47.5 314.9 48.8 756.3 1,495.9 364.7

Standard Policy Forms E F G

H

I

J

Covered Lives (in thousands) 83.4 1,876.9 118.8 113.7 89.1 145.8 60.7 342.3 26.8 19.5 62.5 106.9 144.1 2,219.2 145.7 133.1 151.6 252.7

Other

Prestandard

257.2 39.2 296.4

2,014.5 1,071.6 3,086.1

7,041.5 2,266.3 9,307.7

348.6 188.8 537.4

65.3% 34.7% 100.0%

75.7% 24.3% 100.0%

64.9% 35.1% 100.0%

28.6% 47.3% 33.2%

100.0% 100.0% 100.0%

5.0% 8.3% 5.8%

Percent within Plan Type: 52.0% 93.7% 78.9% 86.6% 57.9% 84.6% 81.6% 85.4% 58.8% 57.7% 86.8% 48.0% 6.3% 21.1% 13.4% 42.1% 15.4% 18.4% 14.6% 41.2% 42.3% 13.2% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

1.9% 5.5% 2.8%

10.1% 16.8% 2.1% 13.9% 8.1% 16.1%

Source: Authors' tabulations of 1999 NAIC data .

4.5% 2.2% 3.9%

1.2% 2.7% 1.5%

26.7% 15.1% 23.8%

Percent within Policy Fom: 1.7% 1.6% 1.3% 2.1% 1.2% 0.9% 2.8% 4.7% 1.6% 1.4% 1.6% 2.7%

Summary: Standard Policy Forms that Cover Prescription Total drugs (H, I or J)

3.7% 1.7% 3.2%

TABLE 5

PERCENT OF COVERED LIVES IN GROUP OR INDIVIDUAL MEDIGAP PLANS, BY POLICY FORM AND STATE, 1999 Summary:

AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IN KS KY LA MA MD ME MI MN MO MS MT

A

B

C

7.0% 1.8% 4.4% 9.3% 4.9% 2.8% 1.1% 4.8% 3.4% 2.7% 4.5% 39.2% 2.1% 5.3% 3.2% 3.6% 1.2% 2.1% 1.4% 0.2% 2.2% 1.6% 3.9% 0.1% 9.4% 2.4% 1.4%

1.4% 76.2% 1.3% 2.7% 2.1% 2.6% 1.1% 3.0% 8.1% 9.2% 4.6% 1.0% 0.4% 0.7% 3.1% 3.5% 0.6% 10.9% 3.8% 0.1% 3.0% 5.9% 2.7% 0.1% 2.5% 3.3% 0.5%

11.4% 8.3% 13.5% 13.5% 10.6% 8.5% 10.4% 11.7% 2.3% 22.1% 22.1% 8.4% 5.7% 10.2% 5.3% 14.7% 11.1% 19.1% 11.8% 0.7% 16.8% 50.7% 22.2% 0.2% 12.9% 10.2% 23.4%

Standard Plans D E F 2.1% 0.9% 13.6% 3.4% 2.6% 2.7% 2.8% 2.1% 33.4% 6.1% 3.4% 2.5% 1.3% 0.9% 10.6% 3.9% 2.7% 4.7% 1.6% 0.1% 3.1% 3.7% 11.6% 0.0% 4.8% 6.7% 0.3%

1.9% 0.5% 0.5% 1.9% 1.5% 0.9% 1.3% 2.5% 13.3% 3.1% 8.8% 1.4% 1.8% 0.6% 1.2% 1.8% 1.0% 0.7% 0.6% 0.1% 0.6% 3.3% 3.2% 0.0% 0.3% 0.9% 0.2%

27.8% 6.4% 24.2% 32.9% 18.0% 39.5% 12.0% 17.7% 2.2% 17.3% 26.6% 15.3% 50.3% 63.4% 39.3% 35.7% 54.7% 13.5% 38.3% 1.5% 16.0% 11.2% 22.2% 0.3% 24.6% 41.7% 35.2%

G

H

I

1.9% 0.5% 0.9% 3.4% 3.3% 2.5% 0.8% 2.9% 0.5% 1.1% 2.7% 1.6% 0.8% 2.9% 1.0% 2.9% 1.4% 1.5% 2.7% 0.1% 1.6% 0.9% 2.5% 0.0% 1.5% 2.9% 0.3%

0.4% 0.0% 0.0% 1.0% 0.4% 0.3% 0.9% 0.4% 0.1% 0.2% 0.1% 0.6% 0.1% 0.1% 0.1% 0.6% 0.1% 6.9% 0.1% 0.0% 0.2% 0.4% 0.3% 0.0% 0.3% 0.1% 0.0%

9.0% 0.2% 2.3% 1.3% 2.0% 3.1% 0.7% 3.5% 5.6% 1.0% 0.8% 2.5% 0.3% 0.3% 0.6% 1.5% 0.8% 0.6% 1.4% 0.3% 1.5% 7.0% 1.2% 0.0% 0.8% 0.5% 0.1%

J

Other

8.9% 0.1% 0.2% 0.0% 0.4% 28.2% 3.6% 0.2% 5.3% 0.1% 2.6% 0.1% 2.5% 0.0% 11.0% 0.0% 6.5% 0.0% 1.4% 0.1% 1.4% 0.0% 7.4% 0.0% 1.6% 0.1% 2.3% 0.0% 1.5% 0.1% 1.8% 0.1% 1.3% 1.3% 0.7% 0.0% 0.7% 0.1% 0.3% 62.1% 2.9% 0.0% 3.5% 0.0% 1.9% 0.1% 0.0% 55.7% 1.3% 0.1% 3.2% 0.0% 9.7% 0.1%

Total Covered Percent in Standard Lives, all Plans Percent in Plans that Cover Prestandard (in thousands) Standard Plans Prescription Drugs 30.8% 5.5% 13.5% 33.8% 52.6% 35.9% 67.1% 40.6% 25.4% 35.7% 27.6% 23.7% 37.2% 14.2% 36.2% 32.5% 23.8% 40.1% 37.4% 34.8% 52.2% 12.3% 31.2% 43.5% 43.3% 29.1% 29.3%

5.8 218.1 152.5 83.3 238.3 74.9 205.6 5.0 17.3 591.1 201.8 6.7 271.4 58.8 532.2 296.2 189.0 201.8 125.6 38.8 113.4 94.0 119.8 84.1 293.0 127.2 255.1

71.8% 95.0% 61.1% 72.9% 50.7% 65.4% 33.4% 59.6% 75.5% 64.4% 75.1% 79.8% 64.5% 86.6% 65.9% 70.0% 74.9% 60.7% 62.5% 40.2% 47.8% 88.4% 71.7% 52.3% 58.3% 72.0% 71.1%

18.2% 0.4% 2.7% 5.8% 7.7% 6.0% 4.1% 14.9% 12.2% 2.7% 2.4% 10.5% 2.0% 2.7% 2.2% 3.9% 2.2% 8.2% 2.2% 0.6% 4.6% 10.9% 3.4% 0.1% 2.3% 3.8% 9.8%

Table 5 (cont'd) Summary:

NC ND NE NH NJ NM NV NY OH OK OR PA RI SC SD TN TX UT VA VT WA WI WV WY Total

A

B

C

1.7% 1.3% 2.7% 2.7% 2.4% 7.2% 10.5% 4.1% 4.1% 4.4% 2.3% 1.1% 2.8% 3.3% 0.6% 4.2% 2.4% 3.0% 2.0% 3.1% 2.1% 0.0% 3.0% 4.1% 2.9%

4.2% 0.9% 1.7% 1.7% 1.5% 2.9% 4.9% 34.9% 2.5% 2.9% 1.6% 24.1% 0.9% 6.6% 0.7% 4.7% 2.6% 3.2% 3.3% 4.5% 0.7% 0.0% 3.7% 1.2% 8.2%

9.8% 4.6% 7.2% 24.5% 19.4% 11.3% 11.6% 6.6% 29.0% 11.6% 11.8% 38.6% 29.6% 11.2% 3.4% 19.5% 17.0% 15.1% 10.7% 36.8% 13.2% 2.4% 16.2% 11.4% 16.3%

Standard Plans D E F 2.9% 0.4% 1.5% 2.5% 1.3% 3.9% 6.0% 0.7% 5.9% 4.7% 3.5% 3.1% 2.7% 10.5% 0.3% 5.4% 4.3% 4.1% 3.5% 7.5% 0.7% 0.4% 3.8% 1.4% 4.0%

2.4% 0.2% 0.2% 9.6% 0.4% 0.7% 2.3% 2.9% 1.8% 1.4% 0.9% 1.0% 2.7% 1.0% 0.5% 1.3% 0.8% 1.8% 1.6% 2.1% 3.2% 0.0% 1.3% 0.9% 1.6%

Source: Authors' tabulations of 1999 NAIC data .

32.9% 84.9% 46.6% 27.5% 14.3% 29.4% 28.7% 15.4% 11.3% 36.3% 32.3% 0.3% 20.9% 31.9% 54.5% 30.7% 33.4% 47.1% 20.5% 0.5% 33.2% 0.1% 20.7% 43.8% 24.2%

G

H

I

J

Other

2.1% 0.3% 0.6% 0.9% 1.0% 2.1% 3.4% 1.8% 1.5% 3.7% 3.2% 0.1% 1.7% 4.3% 1.8% 3.4% 3.5% 2.8% 2.7% 0.0% 0.7% 0.0% 2.0% 1.6% 1.6%

0.7% 0.2% 0.2% 2.5% 0.7% 0.2% 0.2% 9.2% 1.2% 0.1% 0.1% 6.7% 0.7% 0.2% 0.1% 0.2% 0.2% 1.4% 0.1% 1.9% 0.2% 0.0% 0.3% 0.2% 1.4%

2.4% 0.4% 1.2% 0.8% 3.2% 2.6% 2.1% 4.9% 1.5% 0.8% 5.2% 0.2% 3.0% 1.1% 0.4% 0.7% 1.0% 5.1% 4.9% 22.4% 7.0% 0.0% 2.6% 1.7% 1.7%

9.8% 0.5% 0.5% 9.0% 5.7% 3.7% 3.7% 0.9% 2.3% 1.0% 1.6% 0.5% 5.3% 0.8% 2.3% 1.1% 4.9% 6.5% 7.0% 3.6% 6.7% 0.0% 3.1% 2.9% 2.8%

0.1% 0.0% 0.6% 0.0% 0.0% 0.1% 0.3% 0.0% 0.1% 0.1% 0.0% 0.0% 0.0% 0.0% 0.3% 0.0% 0.1% 0.0% 0.0% 0.0% 0.1% 67.6% 0.1% 0.3% 3.2%

Total covered lives, all plans Prestandard (in thousands) 31.5% 7.2% 39.1% 20.2% 52.3% 42.0% 32.0% 21.1% 41.7% 34.8% 37.7% 24.8% 30.7% 31.0% 35.1% 31.6% 30.7% 10.9% 44.6% 19.3% 32.2% 29.4% 44.0% 32.1% 33.6%

347.0 64.4 137.4 43.0 441.0 35.7 31.3 388.4 320.1 94.3 89.7 865.0 6.5 164.2 71.9 125.9 464.8 76.2 266.3 31.4 158.8 258.4 74.0 25.9 9,182.1

Percent in standard plans

Percent in standard plans that cover prescription drugs

69.0% 93.8% 62.4% 81.7% 49.8% 64.0% 73.5% 81.4% 61.2% 67.0% 62.4% 75.5% 70.2% 71.0% 64.6% 71.3% 70.0% 90.1% 56.4% 82.4% 67.7% 61.5% 56.6% 69.4% 64.5%

12.9% 1.1% 2.0% 12.3% 9.5% 6.5% 6.1% 15.0% 5.0% 2.0% 6.9% 7.3% 8.9% 2.2% 2.7% 2.0% 6.0% 13.0% 12.1% 27.9% 13.9% 0.0% 5.9% 4.8% 5.9%

TABLE 6

PERCENT OF COVERED LIVES IN OPEN PRODUCTS: INDIVIDUAL PLANS BY POLICY FORM AND STATE, 1999

State AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IN KS KY LA MD ME MI MO MS MT NC ND NE

A B C 74.0% 98.7% 99.5% 96.0% 2.9% 93.3% 99.1% 77.9% 97.4% 94.3% 94.8% 49.4% 96.5% 93.8% 85.6% 95.8% 93.0% 86.1% 98.9% 97.0% 99.5% 99.6% 99.3% 99.7% 99.1% 99.0% 100.0% 91.1% 95.5% 90.6% 69.3% 89.3% 61.4% 1.6% 100.0% 100.0% 96.4% 91.5% 95.4% 99.7% 95.8% 97.7% 98.0% 98.9% 96.0% 95.5% 95.9% 94.2% 95.4% 80.6% 84.9% 98.8% 98.5% 98.7% 91.4% 94.2% 93.7% 78.1% 81.1% 63.5% 11.1% 7.7% 2.0% 98.2% 98.9% 76.4% 99.1% 91.8% 82.4% 99.0% 92.3% 94.9% 11.8% 77.8% 4.7% 41.8% 64.5% 54.5% 45.5% 96.9% 65.4% 94.5% 96.4% 93.4%

Summary: All Standard Policy Forms Standard All D E F G H I J Other Policies Policies 100.0% 100.0% 84.0% 96.2% 100.0% 41.1% 100.0% 0.0% 84.0% 58.3% 98.8% 99.7% 94.7% 77.2% 95.6% 100.0% 100.0% 0.0% 20.2% 19.1% 100.0% 99.8% 99.4% 98.3% 100.0% 100.0% 100.0% 100.0% 98.6% 85.9% 99.7% 96.7% 80.1% 98.6% 7.7% 98.7% 56.3% 0.0% 77.5% 59.7% 100.0% 98.6% 73.3% 99.2% 100.0% 86.8% 17.4% 0.0% 83.9% 43.3% 99.8% 93.5% 93.2% 97.1% 94.7% 93.9% 10.7% 0.0% 92.5% 64.7% 99.1% 100.0% 97.8% 100.0% 100.0% 82.1% 99.7% 98.7% 33.3% 100.0% 100.0% 99.7% 99.3% 100.0% 99.4% 100.0% 99.7% 59.7% 99.9% 99.9% 100.0% 100.0% 100.0% 100.0% 99.9% 0.0% 99.8% 75.3% 98.2% 99.7% 80.1% 85.5% 86.0% 89.3% 82.4% 26.8% 89.4% 57.1% 99.9% 21.4% 74.3% 97.2% 100.0% 99.7% 100.0% 0.0% 67.5% 49.1% 100.0% 99.7% 92.5% 100.0% 100.0% 100.0% 0.0% 16.3% 14.9% 100.0% 100.0% 97.3% 98.5% 100.0% 98.7% 99.2% 0.0% 97.3% 61.6% 99.4% 62.5% 93.7% 98.9% 54.5% 58.8% 78.2% 0.0% 94.2% 85.4% 100.0% 100.0% 96.0% 94.4% 99.8% 98.8% 98.8% 0.3% 97.0% 67.4% 99.9% 99.7% 91.9% 96.4% 100.0% 99.2% 44.9% 0.0% 93.5% 61.4% 99.0% 99.0% 97.5% 97.2% 75.4% 82.0% 34.1% 0.4% 94.2% 71.4% 100.0% 100.0% 96.9% 99.5% 100.0% 99.7% 99.5% 0.0% 98.6% 66.5% 99.5% 99.9% 97.0% 96.6% 100.0% 100.0% 99.6% 0.6% 96.3% 61.0% 100.0% 99.4% 75.1% 99.6% 100.0% 10.4% 100.0% 0.0% 73.8% 35.3% 70.3% 63.2% 5.4% 25.3% 0.5% 0.0% 0.1% 0.0% 7.0% 6.9% 99.9% 99.4% 96.1% 97.1% 61.1% 80.8% 26.3% 0.0% 90.1% 70.6% 99.7% 97.3% 74.9% 95.3% 86.7% 42.5% 6.2% 0.0% 83.0% 48.9% 100.0% 100.0% 95.7% 95.9% 100.0% 99.7% 100.0% 48.8% 96.1% 68.2% 100.0% 100.0% 19.6% 96.8% 100.0% 100.0% 0.1% 0.0% 12.8% 9.1% 81.2% 67.9% 45.2% 96.0% 0.6% 5.3% 0.1% 0.0% 42.3% 30.7% 99.5% 87.5% 10.2% 100.0% 100.0% 99.5% 81.6% 0.0% 14.4% 13.5% 100.0% 99.2% 93.3% 96.4% 100.0% 81.1% 72.6% 4.8% 93.2% 58.7%

Table 6 (cont'd)

State NH NJ NM NV NY OH OK OR PA RI SC SD TN TX UT VA VT WA WV WY Total

A

B

C

D

Standard Policy Forms E F G

H

I

Other

30.5% 58.1% 51.2% 34.7% 100.0% 27.4% 99.1% 0.4% 82.4% 0.3% 19.2% 100.0% 16.5% 100.0% 100.0% 43.4% 100.0% 100.0% 17.2% 100.0% 57.0% 43.0% 90.1% 99.7% 60.0% 81.9% 98.0% 100.0% 11.5% 89.3% 0.0% 98.5% 96.4% 92.2% 100.0% 100.0% 94.8% 99.2% 100.0% 99.8% 99.4% 0.0% 29.2% 99.0% 50.8% 91.3% 87.1% 98.7% 98.9% 0.0% 41.5% 0.0% 97.1% 91.2% 89.7% 99.9% 97.7% 92.1% 96.6% 100.0% 98.6% 37.9% 0.0% 99.1% 94.1% 95.5% 99.9% 100.0% 96.9% 99.8% 100.0% 99.2% 98.5% 0.0% 71.4% 95.2% 74.9% 99.5% 99.6% 68.4% 99.5% 97.0% 31.0% 89.6% 0.0% 15.9% 3.6% 11.5% 97.4% 98.6% 100.0% 100.0% 2.6% 66.1% 0.0% 96.7% 100.0% 99.7% 100.0% 100.0% 99.5% 99.0% 100.0% 100.0% 100.0% 0.0% 97.4% 96.3% 99.4% 100.0% 98.3% 98.2% 98.5% 100.0% 99.7% 39.0% 0.0% 94.9% 93.3% 94.0% 100.0% 100.0% 88.3% 98.0% 87.5% 91.9% 84.7% 0.0% 85.3% 88.0% 90.1% 99.9% 96.3% 89.4% 97.9% 100.0% 97.6% 72.3% 10.3% 95.8% 85.4% 93.2% 97.4% 81.0% 89.9% 95.6% 82.7% 62.6% 88.2% 0.0% 30.0% 63.5% 28.5% 45.4% 23.4% 16.7% 21.3% 1.1% 0.6% 0.7% 0.0% 86.6% 95.6% 82.6% 100.0% 98.4% 96.5% 97.7% 100.0% 99.8% 100.0% 0.0% 28.4% 95.4% 46.9% 100.0% 98.5% 1.1% 5.0% 0.0% 100.0% 62.0% 64.3% 60.1% 100.0% 20.1% 24.2% 99.6% 100.0% 10.3% 100.0% 5.2% 94.5% 89.3% 90.2% 100.0% 99.9% 95.3% 97.1% 100.0% 50.8% 99.8% 0.0% 86.6% 92.8% 60.7% 99.4% 100.0% 67.0% 97.0% 100.0% 99.5% 82.4% 1.1% 79.3% 46.6% 57.4% 98.0% 77.8% 79.0% 95.0% 21.1% 51.2% 51.1% 57.0%

Source: Authors' tabulations of 1999 NAIC data; HCFA (2000). Note:

J

Minnesota, Massachusetts and Wisconsin operate under waivers of Federal rules governing Medigap plans. Blank cells indicate that policy form is not in force in the state.

Summary: All Standard All Policies Policies 41.0% 28.8% 78.7% 96.0% 79.2% 92.5% 97.1% 71.6% 12.3% 99.6% 98.5% 89.0% 90.9% 91.3% 19.7% 94.7% 33.8% 35.5% 92.3% 70.5% 67.7%

36.9% 10.4% 45.3% 66.1% 73.4% 49.2% 63.8% 44.8% 11.5% 69.2% 72.2% 58.3% 68.5% 73.3% 18.9% 53.1% 30.7% 23.3% 51.7% 47.4% 48.0%

TABLE 7

PERCENT OF INDIVIDUAL COVERED LIVES IN OPEN AND GUARANTEED ISSUE PRODUCTS, 1999

Covered Lives (in millions), All Individual Products

A

B

C

D

0.1

0.7

1.2

0.3

Standard Policy Forms E F G

0.1

1.9

0.1

H

I

J

Other

0.1

0.1

0.1

0.3

Total, Total Including Standard Pre-standard

4.8

7.0

Product Type: Open products Open, guaranteed issue Open, accept disabled

79.3% 20.1% 27.0%

67.7% 17.6% 15.8%

48.0% 12.6% 11.2%

Open products Open, guaranteed issue Open, accept disabled

Covered Lives as a Percent of Total Enrollment in Open Products in Policy Form: 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 25.4% 56.0% 18.2% 35.6% 41.1% 22.8% 6.6% 6.8% 4.7% 21.9% 31.9% 25.9% 34.0% 53.8% 22.3% 10.2% 17.3% 19.1% 17.6% 73.4% 29.4% 17.5% 20.8% 23.4%

100.0% 48.0% 12.6%

Open products Open, guaranteed issue Open, accept disabled

3.2% 3.1% 4.7%

46.6% 26.1% 25.1%

9.8% 20.9% 22.6%

57.4% 10.4% 12.8%

Covered Lives as a Percent of Total Enrollment in Policy Form: 98.0% 77.8% 79.0% 95.0% 21.1% 51.2% 51.1% 57.0% 34.9% 32.0% 18.0% 6.3% 1.4% 2.4% 11.2% 18.2% 10.0% 13.5% 15.1% 16.7% 15.5% 15.1% 8.9% 11.8%

20.1% 13.9% 19.2%

Covered Lives as a Percent of Enrollment in Product Type: 9.2% 1.9% 43.9% 3.3% 0.7% 1.4% 2.2% 4.3% 12.5% 3.0% 38.2% 0.8% 0.2% 0.2% 1.8% 5.3% 4.0% 1.4% 36.1% 2.5% 2.2% 1.7% 1.7% 3.9%

Source: Authors' tabulations of 1999 NAIC data. Note:

Minnesota, Massachusetts and Wisconsin operate under waivers of Federal rules governing Medigap plans.

95.7% 67.7% 96.1%

100.0% 100.0% 100.0%

TABLE 8

INDIVIDUAL COVERED INDIVIDUAL COVERED LIVES IN GUARANTEED ISSUE PRODUCTS AS A PERCENT OF TOTAL COVERED LIVES, BY STANDARD POLICY FORM AND STATE, 1999

State AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IN KS KY LA MA MD ME MI MN MO MS MT NC ND

A 11.8% 3.1% 59.0% 3.5% 7.8% 9.9% 69.3% 6.5% 1.4% 66.0% 3.2% 0.0% 33.1% 1.0% 75.5% 2.2% 58.2% 3.0% 40.0%

B 7.9% 0.1% 1.7% 1.4% 2.5% 4.1% 88.6% 3.5% 0.5% 50.7% 0.6% 50.0% 6.3% 7.9% 78.8% 9.3% 2.7% 48.4% 13.5%

63.1% 1.0% 26.5% 95.2% 0.4% 12.8% 1.5% 4.6% 3.0%

14.1% 0.2% 0.9% 97.1% 12.1% 4.7% 0.4% 0.6% 0.6%

C 4.5% 2.0% 2.0% 2.6% 3.2% 9.7% 77.1% 5.5%

D 6.1% 2.3% 95.6% 0.7% 2.7% 1.0% 56.6% 5.4% 0.1% 77.8% 0.8%

E 2.8% 2.0% 1.4% 16.7% 2.7% 29.0% 1.4% 0.8% 0.2% 99.4% 0.1%

32.1% 1.3% 11.8% 16.3% 0.3% 0.1% 1.6% 4.7% 58.2% 83.7% 97.6% 0.9% 0.2% 0.3% 39.3% 0.4% 0.7% 5.7% 0.2% 1.1% 31.2% 19.8% 98.1% 95.0% 21.6% 18.0% 88.4% 0.1% 0.1% 12.8% 0.2% 0.1% 97.6% 100.0% 87.5% 12.7% 0.5% 23.6% 3.6% 23.8% 3.9% 0.1% 2.7% 3.0% 3.5% 0.5% 0.3% 0.1% 2.8%

F 1.6% 1.5% 1.4% 0.2% 0.2% 4.4% 76.3% 3.5% 41.1% 0.1% 0.3% 3.3% 0.2% 64.3% 0.1% 83.4% 0.8% 17.9% 37.9% 0.0% 0.3% 92.9% 1.0% 13.3% 0.0% 0.2% 0.0%

G 4.8% 2.6% 1.0% 0.6% 0.6% 0.5% 11.8% 1.4%

H 9.1% 20.6% 14.5% 3.2% 6.2% 7.9% 2.3% 4.5%

I 0.8% 4.4% 0.4% 5.1% 2.9% 1.0% 39.1% 1.1% 0.1% 29.6% 8.6% 8.2% 0.7% 2.0% 1.2% 100.0% 66.7% 0.1% 0.7% 0.3% 54.5% 10.3% 19.2% 10.6% 1.6% 0.1% 0.9% 0.8% 0.3% 5.7% 1.2% 0.3% 4.9% 1.8% 7.6% 27.4% 1.1%

32.9% 0.6% 0.1% 57.1% 1.5% 3.6% 0.2% 0.7%

11.5% 0.5% 9.3%

2.2%

48.1% 36.4% 3.8% 0.3% 1.2%

10.3% 15.6% 1.3% 0.6% 1.0%

5.2%

Total, Total Including J Standard Pre-standard 2.5% 3.2% 2.2% 10.9% 0.5% 0.4% 8.3% 25.1% 14.7% 4.2% 1.0% 0.8% 0.7% 1.8% 0.9% 0.9% 4.7% 3.3% 0.9% 67.8% 22.9% 4.0% 4.0% 2.4% 0.2% 0.2% 3.2% 45.2% 28.9% 0.1% 0.6% 0.5% 0.5% 0.4% 0.0% 4.2% 2.6% 1.4% 0.5% 0.5% 2.1% 65.6% 45.6% 0.5% 0.9% 0.6% 2.0% 67.9% 51.5% 3.6% 11.6% 7.8% 9.2% 20.5% 13.0% 0.1% 0.1% 3.0% 27.8% 13.3% 0.1% 0.1% 0.1% 1.5% 5.0% 3.9% 0.9% 0.5% 4.8% 4.3% 2.6% 82.9% 14.1% 10.0% 0.1% 0.1% 0.1% 0.7% 0.5% 0.0% 0.0%

TAB LE 8

(Cont'd)

State

A

B

C

D

E

F

NE NH NJ NM NV NY OH OK OR PA RI SC SD TN TX UT VA VT WA WI WV WY Total

0.9% 2.2% 5.2% 2.9% 4.7% 18.4% 4.5% 3.3% 8.4% 0.6% 7.3% 6.6%

0.0% 1.1% 14.3% 0.9% 1.4% 99.0% 1.3% 4.9% 0.6% 0.0%

0.7% 0.2% 7.7% 0.6% 2.0% 91.3% 0.1% 3.8% 0.3% 0.2% 1.2% 0.1%

0.8% 0.0% 40.0% 40.0% 2.1% 77.4% 1.3% 0.7% 0.3% 0.2% 1.2%

0.0% 0.3% 1.2% 0.3% 1.4% 36.8% 0.3% 4.3% 8.3%

6.8% 24.9% 1.6% 2.6% 2.0% 48.4%

0.2% 0.6% 0.6% 17.0% 0.2% 0.4% 0.7% 49.3%

0.1% 0.5% 2.0% 2.0% 4.0% 50.6% 0.7% 17.7% 3.4% 0.1% 1.1% 6.9% 0.1% 1.9% 18.6% 0.4% 0.7% 0.2% 34.0%

0.3% 70.8% 0.4% 0.2% 0.1% 65.9%

1.1% 18.1% 0.4% 0.7% 0.7% 19.3%

3.0% 2.5% 20.1%

1.1% 0.7% 26.1%

2.6% 0.4% 10.4%

0.6% 1.5% 34.9%

2.0% 0.9% 32.0%

2.0% 0.1% 0.0% 0.1% 15.5% 0.1% 1.3% 11.6% 17.6% 1.5% 0.1% 18.0%

G

H

I

J

0.1% 2.2% 0.3% 0.3% 2.7% 0.3% 41.2% 0.3% 7.2% 100.0% 3.4% 100.0% 0.2% 66.7% 0.7% 1.0% 22.7% 2.9% 4.7% 98.9% 1.1% 0.4% 1.4% 4.0% 1.9% 17.1% 0.7% 1.9% 0.1% 1.0% 18.0% 0.2% 0.1% 24.3% 7.1% 2.1% 2.9% 0.2% 1.5% 0.3% 9.8% 2.5% 0.1% 0.2% 12.2% 7.3% 0.1% 9.3% 0.2% 76.2% 0.2% 0.3% 0.1% 0.4% 0.1% 57.1% 0.0% 0.0% 5.0% 100.0% 42.4% 14.6% 0.2% 1.5% 2.2% 6.3%

6.4% 5.1% 1.4%

1.4% 0.5% 2.4%

1.3% 11.2%

Total, Total Including Standard Pre-standard 0.1% 0.4% 2.6% 0.7% 2.4% 72.2% 0.7% 6.4% 6.8% 0.1% 1.7% 1.3% 0.0% 0.8% 23.3% 0.2% 0.7% 0.2% 17.8% 0.0% 1.9% 0.3% 17.6%

Source: Authors' tabulations of 1999 NAIC data. Note:

Minnesota, Massachusetts and Wisconsin operate under waivers of Federal rules governing Medigap plans. Blank cells indicate that product is not marketed in the state.

0.0% 0.4% 0.9% 0.4% 1.7% 66.9% 0.4% 4.2% 4.3% 0.1% 1.2% 1.0% 0.0% 0.6% 18.7% 0.2% 0.4% 0.2% 11.7% 0.0% 1.0% 0.2% 11.9%

TABLE 9

NUMBER OF GROUP AND INDIVIDUAL MEDIGAP INSURERS AND NUMBER PER THOUSAND COVERED LIVES, BY STATE, 1999

State AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IN KS KY LA MA MD ME MI MN MO MS MT NC ND NE NH NJ NM NV NY OH OK OR PA RI SC SD

Total 21 38 41 48 75 56 28 50 24 44 36 40 53 54 70 63 37 41 54 75 24 21 52 33 58 35 40 28 46 31 37 43 48 28 24 53 50 28 66 30 27 39

Group Insurers Insurers Per 1000 Covered Lives 72.1 12.3 8.0 1.0 0.4 2.1 0.4 373.1 39.8 1.7 3.7 10.5 1.4 5.5 1.0 0.6 10.8 1.6 20.1 3.4 30.9 0.8 1.2 7.5 0.8 3.6 3.1 0.3 10.5 2.1 2.1 0.1 2.3 10.7 0.1 0.3 10.6 18.2 0.3 81.1 0.6 32.2

Individual Insurers Insurers Per 1000 Total Covered Lives 80 14.1 224 1.0 141 0.9 213 5.2 183 2.4 164 3.4 61 0.5 60 12.3 89 5.3 225 0.4 192 1.0 82 26.7 160 0.7 159 3.2 228 0.5 188 0.9 146 0.8 154 0.9 184 1.5 97 5.8 108 1.0 129 1.9 139 1.8 148 1.9 204 0.9 177 1.5 128 0.5 153 0.6 109 1.8 160 1.3 104 4.0 153 1.0 126 7.4 170 5.6 71 0.3 193 1.1 181 2.0 184 2.1 161 0.3 32 5.3 122 1.0 136 1.9

TABLE 9

(Cont'd)

State

Total

TN TX UT VA VT WA WI WV WY US Average

52 52 41 48 29 51 44 38 28 42.6

Group Insurers Insurers Per 1000 Covered Lives 1.2 0.3 2.7 0.7 2.0 3.8 0.8 17.7 22.1 16.5

Individual Insurers Insurers Per 1000 Total Covered Lives 196 207 128 165 77 203 170 136 116 147.4

Source:

Authors' tabulations of 1999 NAIC data; HCFA (July 2000).

Note:

Medicare enrollees include both elderly and disabled.

2.3 0.7 2.1 0.8 4.3 1.4 0.8 1.9 4.6 3.0

TABLE 10

NUMBER AND PERCENT OF ACTIVE GROUP AND INDIVIDUAL MEDIGAP INSURERS AND NUMBER PER MEDICARE BENEFICIARY, BY STATE, 1999

State AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IN KS KY LA MA MD ME MI MN MO MS MT NC ND NE NH NJ NM NV NY OH OK OR PA RI SC SD TN

Total 8 15 17 23 30 26 13 10 13 20 20 11 23 18 29 25 16 18 18 15 11 12 24 14 24 22 21 16 18 20 16 16 23 16 13 29 20 13 23 11 18 14 25

Active Group Insurers Percent of Insurers Per All Insurers 1000 Covered Lives 37.5% 27.0 40.0% 4.9 41.2% 3.3 47.8% 0.5 40.0% 0.2 46.2% 1.0 46.2% 0.2 20.0% 74.6 53.8% 21.4 45.0% 0.8 55.0% 2.0 27.3% 2.9 43.5% 0.6 33.3% 1.8 41.4% 0.4 40.0% 0.3 43.8% 4.7 44.4% 0.7 33.3% 6.7 20.0% 0.7 45.5% 14.0 58.3% 0.5 45.8% 0.5 42.9% 3.2 41.7% 0.3 63.6% 2.3 52.4% 1.6 56.3% 0.2 38.9% 4.1 65.0% 1.4 43.8% 0.9 37.5% 0.1 47.8% 1.1 56.3% 6.0 53.8% 0.1 55.2% 0.2 40.0% 4.2 46.2% 8.4 34.8% 0.1 36.4% 29.5 66.7% 0.4 35.7% 11.5 48.0% 0.6

Total 39 82 75 100 80 83 33 30 40 105 93 30 81 68 111 94 81 85 92 26 53 44 79 57 106 94 67 83 58 82 42 41 71 75 28 102 96 78 73 22 69 72 99

Active Individual Insurers Percent of Insurers Per All Insurers 1000 Covered Lives 48.7% 6.9 36.6% 0.4 53.3% 0.5 47.0% 2.4 43.8% 1.0 50.6% 1.7 54.5% 0.3 50.0% 6.1 45.0% 2.4 46.7% 0.2 48.4% 0.5 36.7% 9.8 50.6% 0.3 42.6% 1.4 48.6% 0.2 50.0% 0.5 55.6% 0.4 55.3% 0.5 50.0% 0.7 26.9% 1.6 49.1% 0.5 34.1% 0.6 57.0% 1.0 38.6% 0.7 51.9% 0.5 53.2% 0.8 52.2% 0.3 54.2% 0.3 53.4% 1.0 51.2% 0.7 40.5% 1.6 26.8% 0.3 56.3% 4.1 44.0% 2.5 39.3% 0.1 52.9% 0.6 53.1% 1.1 42.3% 0.9 45.2% 0.1 68.2% 3.6 56.5% 0.6 52.8% 1.0 50.5% 1.1

Table 10

State TX UT VA VT WA WI WV WY Average US

(Cont'd)

Total 24 18 24 12 16 22 15 15 18.3

Active Group Insurers Percent of Insurers Per All Insurers 1000 Covered Lives 45.8% 0.2 44.4% 1.2 50.0% 0.3 41.7% 0.8 31.3% 1.2 50.0% 0.4 40.0% 7.1 53.3% 11.8 5.3 45.1%

Source: Authors' tabulations of 1999 NAIC data.

Total 117 62 87 35 78 75 70 60 70.6

Active individual insurers Percent of Insurers Per All Insurers 1000 Covered Lives 56.4% 0.4 48.4% 1.0 52.9% 0.4 45.7% 2.0 38.5% 0.5 44.0% 0.4 51.4% 1.0 51.7% 2.4 1.4 49.0%

TABLE 11 NUMBER OF INSURERS WITH OPEN PRODUCTS IN THE INDIVIDUAL MARKET BY STANDARD POLICY FORM AND STATE, 1999

State AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IN KS KY LA MA MD ME MI MN MO MS MT NC ND

A 11 30 33 38 34 27 18 10 15 46 45 5 37 22 47 45 32 36 40

B 5 29 33 28 21 26 10 9 16 38 38 2 26 13 34 30 24 32 41

23 9 32 3 45 36 23 39 18

14 7 18 2 35 40 20 30 12

C 13 38 39 44 30 33 16 15 6 48 39 5 42 27 48 44 37 46 46 2 26 12 44 4 43 47 28 35 29

D 6 11 17 13 14 13 10 8 13 20 22 1 15 9 23 23 14 19 18

E 2 8 7 8 7 7 3 3 9 13 8 5 2 12 9 7 10 7

10 5 16 1 17 21 11 16 8

9 2 7 2 8 9 6 7 2

F 17 38 41 43 34 39 16 14 7 46 44 11 44 31 56 45 37 41 51 4 27 11 34 4 48 56 31 40 31

G 4 14 13 14 11 14 5 7 4 19 16 1 15 10 19 21 15 13 17

H 2 3 4 4 4 5 4 2 1 11 3 1 4 2 8 10 7 9 4

I 5 9 7 10 8 11 4 6 7 11 10 2 8 7 13 12 11 10 11

J 2 4 5 7 3 5 2 3 2 8 8 1 6 5 9 7 5 6 6

12 6 12 2 16 16 9 16 8

3 1 4 1 8 4 3 2 3

10

6 1 3 1 4 8 3 5 4

8 1 10 8 9 10 9

Average Across Policy Forms 7 18 20 21 17 18 9 8 8 26 23 3 20 13 27 25 19 22 24 3 14 6 18 2 23 25 14 20 12

Average per 1000 Covered Lives 1,178 85 131 509 213 370 69 1,573 475 46 118 1,053 85 258 56 120 102 125 196 180 124 86 226 26 102 206 59 79 204

TABLE 11 (Cont'd)

State

A

B

C

D

E

F

G

H

I

J

NE NH NJ NM NV NY OH OK OR PA RI SC SD TN TX UT VA VT WA WI WV WY

31 13 7 26 29 6 54 47 23 20 8 37 22 42 72 19 34 11 22

40 18 11 35 30 6 55 52 28 25 13 38 34 49 65 24 35 12 26 6 31 30

18 9 5 13 14 2 26 22 11 12 6 21 10 22 23 11 18 6 9 1 13 14

6 4 3 2 6 3 11 10 6 6 3 5 5 6 8 5 8 4 6

6 2 1 2 3

8 1 1 3 5

8 1 11 7

8 7 2 8 3 4 4 5 10 4 5 1 3 1 4 3

10 5 4 8 9 2 12 12 11

9 3

43 16 12 33 27 7 52 54 32 5 14 39 40 51 68 31 42 1 25 6 34 28

12 6 6 12 12 2 17 19 10 1 4 14 14 15 20 9 12

30 17

24 9 5 23 22 5 40 40 15 28 8 33 19 39 51 14 29 9 13 1 21 16

Totala

1369

1097

1549

660

298

1601

541

203

Source: Authors' tabulations of 1999 NAIC data. a

Insurers that write coverage in multiple states are counted as multiple insurers.

Average Across Policy Forms

Average Per 1000 Covered Lives 158 316 37 916 515 20 160 297 162 19 1,043 167 226 281 109 205 101 316 84 13 227 523 112

5

5 8 5 3 2 5 6 5 9 3 7 1 5

7 8

4 5

20 8 6 16 16 4 28 27 14 12 6 21 16 24 34 13 20 6 12 3 16 13

378

220

792

3 10 6 9 13 7 10

TABLE 12

ALL INSURERS, ACTIVE INSURERS, AND ACTIVE INSURERS WITH GUARANTEED ISSUE IN THE INDIVIDUAL MEDSUPP MARKET BY PRODUCT TYPE, US TOTAL 1999

A

Total Insurers with open product Insurers with guaranteed issue product

1,614 1,369 265

B

1,265 1,097 192

C

1,802 1,549 254

D

707 660 102

Standard Policy Forms E F G

351 298 88

H

Number of Insurers: a 1,837 609 234 1,601 541 203 158 92 77

I

J

Other

Pre-standard

453 378 75

288 220 63

110 52 8

3,454 na na

Total Insurers with open product Insurers with guaranteed issue product

Percent Among all Insurers: 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 84.8% 86.7% 86.0% 93.4% 84.9% 87.2% 88.8% 86.8% 83.4% 76.4% 47.3% 16.4% 15.2% 14.1% 14.4% 25.1% 8.6% 15.1% 32.9% 16.6% 21.9% 7.3%

100.0% na na

Insurers with open product Insurers with guaranteed issue product

Percent Among Insurers with Open Product: 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 19.4% 17.5% 16.4% 15.5% 29.5% 9.9% 17.0% 37.9% 19.8% 28.6% 15.4%

na na

Source: Authors' tabulations of 1999 NAIC data. a

Insurers that write coverage in multiple states are counted as multiple insurers.

TABLE 13 NUMBER OF INSURERS WITH OPEN, GUARANTEED ISSUE PRODUCTS IN THE INDIVIDUAL MARKET BY STANDARD POLICY FORM AND STATE, 1999

State AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IN KS KY LA MA MD ME MI MN MO MS MT NC

A 4 6 8 8 7 5 7 3 2 10 7 1 8 3 11 8 7 6 11

B 1 4 6 5 4 4 4 2 1 9 4 1 4 3 8 6 3 7 8

6 3 10 1 8 8 4 6

4 2 4 1 6 6 2 4

C 3 6 7 7 5 5 8 5 10 4 1 6 5 8 5 7 7 9 1 7 2 9 2 7 5 5 4

D 2 2 3 2 2 2 4 2 2 4 2

E 1 3 2 2 2 3 1 1 2 6 1

1 2 4 2 2 2 4

1

3 1 2 1 2 4 2 2

4 2 1 3 4 3 1 1 3 3 1 2

F 2 2 4 3 2 4 5 2

G 1 3 2 2 2 3 2 1

H 1 2 2 3 2 2 1 1

7 4 1 3 2 7 2 4 4 8

4 2 1 2 4 2 2 2 5

4 2 1 1 2 2 2 2 3 2

3 1 4 2 5 6 3 3

4 2 1 1 3 3 1 2

I 1 2 2 2 2 2 2 2 1 2 2 1 1 2 2 2 2 2

2 1 1

3 1

3 2 1 1

2 1 2 3

J 1 2 2 2 1 2 1 2 2 2 1 1 2 1 2 2 1 2 1 1 2 2 2

Average Across Policy Forms 1.7 3.2 3.8 3.6 2.9 3.2 3.5 2.1 1.6 5.8 3.0 1.0 2.9 2.3 5.2 3.2 3.2 3.8 5.4 1.0 3.7 1.6 3.4 1.3 4.1 4.0 2.3 2.9

Average Percent of Insurers with Open Products 25.4% 17.4% 19.1% 17.2% 17.5% 17.8% 39.8% 27.3% 20.0% 22.3% 12.9% 31.0% 14.3% 18.2% 19.3% 13.0% 16.9% 17.1% 22.4% 33.3% 26.4% 27.1% 19.1% 61.2% 17.5% 16.3% 16.3% 14.5%

TABLE 13 (Cont'd)

State

A

B

C

D

E

ND NE NH NJ NM NV NY OH OK OR PA RI SC SD TN TX UT VA VT WA WI WV WY

2 2 2 2 3 7 5 7 7 4 2 2 6

2 1 2 1 3 5 5 6 6 2 4

1 2 2 1 2 2 2 2 3 2 2 1 2

1 1 1 1 2 2 3 4 1 2 1

6 12 4 7 3 5

5 3 6 7 3 5 2 4

2 5 4 2 5 5 4 5 8 4 4 4 5 2 5 11 4 4 4 7

2 3 2 2 1 3

1 3 2 3 1 2

6 3

5 2

6 4

2 2

3 1

4 1 3 1

265

192

254

102

88

158

Totala

F

G

2 1 2 1 2 2 3 4 5 3

1 1 1 1 2 2 2 4 2

2 4 2 4 10 4 5

Source: Authors' tabulations of 1999 NAIC data. a

Insurers that write coverage in multiple states are counted as multiple insurers.

H

I

1 2 1 1 1 1

2 1 1 1 2 2

1 2 1 2 1 1 1 2 3 2 2 1 2

3 2 3

2

2

2 1

2 1

2

92

77

75

63

3 3 3 2 2 4

1 3 1 1 1 2

J

2 1 1 2 1 2 1 2 1 2 1 2 1 2 1 2

Average Across Policy Forms

Average Percent of Insurers with Open Products

1.7 1.8 1.7 1.2 2.2 3.0 3.3 3.4 4.3 2.3 2.6 1.6 3.4 1.8 3.3 5.5 2.5 3.4 1.9 3.5 1.0 3.3 1.9

13.8% 9.1% 20.5% 21.8% 14.2% 19.1% 79.7% 12.1% 15.9% 16.1% 21.4% 25.4% 16.7% 11.3% 13.7% 16.2% 19.7% 17.0% 33.0% 28.7% 37.5% 20.1% 14.3%

136.6

17.3%

TABLE 14 AVERAGE INDIVIDUAL PREMIUM BY POLICY FORM AND STATE, 1999 (In Dollars) Average State AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IN KS KY LA MD ME MI MO MS MT NC ND NE NH NJ

A 771 1,082 805 561 1,063 653 883 1,072 932 1,012 944 962 706 133 823 706 776 699 1,137 822 779 835 1,167 830 271 684 568 680 333 930

B 911 1,117 1,273 1,425 1,868 1,001 1,042 1,214 1,031 1,236 1,283 1,305 1,134 1,382 1,575 1,234 1,359 825 1,528 694 1,017 1,272 1,208 1,420 800 1,120 818 971 616 810

C 1,089 1,256 1,059 1,625 1,708 1,219 1,344 1,266 1,020 1,465 1,325 1,309 1,386 1,239 1,355 1,386 1,447 1,163 1,612 1,127 1,155 1,508 1,363 1,395 129 1,203 1,053 1,196 888 1,455

D 933 1,187 949 971 1,201 802 1,191 1,057 891 1,423 1,036 594 934 821 1,104 855 1,128 833 1,203 642 1,051 871 960 991 757 884 804 729 478 1,031

E 970 1,105 1,076 954 881 739 1,031 1,163 1,140 1,246 905 752 925 1,241 564 1,019 1,023 1,339 1,156 856 909 817 1,350 787 712 953 936 620 865

F 1,140 1,549 1,158 1,471 1,736 1,261 1,279 1,234 935 1,788 1,384 1,069 1,095 1,310 1,300 1,300 1,251 1,270 1,271 1,170 1,019 1,238 1,323 1,309 300 1,108 1,091 1,169 486 1,178

G 1,057 1,145 1,054 775 1,018 833 850 1,179 500 1,544 1,050 863 809 1,079 1,103 933 803 867 1,171 739 472 1,014 746 915 919 606 894 810 524 648

H 1,390 1,960 1,549 2,340 1,445 1,150 1,725 1,499 1,169 2,094 2,009 1,769 1,228 1,447 1,809 1,646 1,594 1,631 2,163 1,485 975 1,378 1,307 1,974 1,223 1,611 1,112 1,183 264 1,117

I 1,545 2,097 2,140 2,582 2,342 1,717 2,566 1,429 1,424 2,265 2,051 1,958 1,767 1,750 1,918 1,899 1,769 1,855 1,972 1,871 1,503 1,867 1,744 2,012 1,452 1,564 1,180 1,814 1,748 1,410

J 1,632 2,420 2,214 3,686 2,766 1,905 2,003 1,772 1,634 2,726 2,248 1,412 2,497 1,846 2,192 2,439 2,124 2,194 2,362 1,934 1,373 1,874 2,549 2,229 135 1,766 1,692 2,402 283 1,888

Other 1,351 1,711 1,569 1,669 1,403 1,815

1,822 1,449 1,797 1,706 1,407 1,742 1,919 1,378 1,420 1,686 1,716 1,535 1,874 1,890 1,545 1,527 1,526 1,447 1,841 1,888

Pre-Standard 1,481 1,823 1,602 1,856 2,074 1,939 949 1,510 1,569 1,916 1,757 1,422 1,461 1,702 1,806 2,268 1,684 1,557 1,930 1,492 1,444 1,730 1,350 1,790 282 2,256 1,516 1,615 1,616 1,455

Averagea 1,292 1,198 1,312 1,492 1,797 1,429 1,070 1,402 1,185 1,668 1,415 1,011 1,253 1,281 1,456 1,601 1,377 1,285 1,575 1,320 1,151 1,345 1,305 1,446 244 1,491 1,110 1,335 698 1,407

Standarda 1,210 1,164 1,122 1,385 1,540 1,211 1,307 1,330 1,060 1,528 1,287 972 1,133 1,237 1,302 1,254 1,279 1,154 1,371 1,863 1,145 1,238 1,274 1,305 227 1,202 1,085 1,168 595 1,321

TABLE 14 (Cont'd)

Average Standarda

State

A

B

C

D

E

F

G

H

I

J

Other

Pre-Standard

Average

NM NV NY OH OK OR PA RI SC SD TN TX UT VA VT WA WV WY

645 877 977 867 856 756 668 809 625 602 806 1,127 506 745 726 696 769 525

870 1,284 1,455 1,929 1,325 1,127 719 1,324 1,073 1,130 1,229 1,290 888 976 1,002 899 1,280 1,176

1,337 1,580 1,442 1,509 1,268 1,181 903 1,355 1,135 1,252 1,341 1,268 971 1,364 1,110 1,109 1,312 1,060

686 1,003 1,082 942 773 857 826 968 1,066 958 919 1,495 610 652 739 914 966 956

957 1,194 702 778 1,126 965 747 1,109 917 783 654 1,053 424 624 930 1,088 1,073 928

1,184 1,371 1,480 1,430 1,341 1,159 923 1,405 1,330 1,076 1,337 1,328 548 1,142 961 1,183 1,246 1,163

765 962 1,106 1,019 884 803 733 1,234 735 957 892 1,072 503 567

1,605 1,609 2,658 2,141 2,077 1,648 1,799 1,908 1,514 2,398 1,857 708 1,382 1,360 1,625 1,711 1,496

2,012 2,012 2,860 2,360 2,230 1,759 1,751 2,130 3,577 2,316 2,691 1,949 721 1,792 3,755 1,897 1,711 1,577

1,793 1,393

709 1,050 841

1,968 1,575 2,068 1,611 1,685 1,633 876 1,807 1,481 1,267 1,407 1,496 614 2,391 1,983 1,611 1,589 1,330

1,588 1,630 1,683

1,688 1,774 1,301 1,757 1,742 1,307 1,337 1,663 1,361 1,752 1,791 1,894 1,473 2,098 1,276 1,451 1,790 1,585

1,362 1,482 1,527 1,560 1,427 1,220 863 1,488 1,224 1,339 1,388 1,454 678 1,590 1,173 1,289 1,495 1,283

1,120 1,352 1,545 1,385 1,262 1,168 830 1,411 1,174 1,122 1,256 1,347 643 1,192 1,163 1,203 1,264 1,135

Averagea

886

1,091

1,159

1,030

997

1,220

934

1,384

1,653

1,619

1,578

1,651

1,316

1,177

1,911 2,046 2,131 717 1,386 1,983 1,572 1,916 1,450 1,504 2,340

Source: Authors' tabulations of 1999 NAIC data. Note: Blank cells indicate that no product is offered in that policy form. Waived states (Massachusetts, Minnesota and Wisconsin) are omitted. a

a

Weighted by number of covered lives.