What does the Omnibus Budget Reconciliation Act (OBRA) establish for Medigap plans?

The Omnibus Budget Reconciliation Act (OBRA) establishes that Medigap plans must meet certain eligibility and benefit requirements to ensure that these insurance policies provide a baseline level of protection for individuals on Medicare. This regulation was put in place to standardize coverage options across the various Medigap policies, making it easier for consumers to compare and understand their choices.

By requiring Medigap plans to meet specific standards, OBRA helps ensure that individuals receive adequate coverage for services not fully paid for by Medicare, such as copayments, deductibles, and other out-of-pocket costs. This standardization also helps to protect consumers from misleading practices and ensures that the benefits provided are appropriately aligned with the needs of Medicare beneficiaries.

The other options suggest a lack of regulation or specific target demographics for Medigap plans, which would contradict the purpose of OBRA. Therefore, the requirement for plans to meet specific eligibility and benefit requirements underscores the importance of maintaining quality and uniformity in Medigap insurance.