Medicare Supplement and LTC

Iowa Medicare Supplement Insurance (Iowa Admin Rule 191-37)

Iowa adopts the NAIC standardized Medicare supplement framework, codified in Iowa Admin Rule Chapter 191-37. The rules are detailed; the Pearson VUE outline tests the most consumer-facing features:

• Purpose (Iowa Admin Rule 191-37.1). Iowa Medicare supplement rules implement minimum standards for the form, content, and sale of Medicare supplement insurance issued in Iowa.
• Required provisions (Iowa Admin Rule 191-37.28). Standard provisions every Iowa Medicare supplement policy must contain, including the renewability provision; the outline of coverage is a separate document given to the applicant with the application.
• Preexisting conditions (Iowa Admin Rule 191-37.8(1)). Iowa Medicare supplement policies may not exclude losses incurred more than 6 months from the effective date of coverage because of a preexisting condition.
• Standardized plans. Iowa Medicare supplement insurers must offer the standardized NAIC plans — currently Plans A, B, D, G, K, L, M, and N (Plans C and F closed to new Medicare enrollees after January 1, 2020, under federal MACRA). Plan A must be offered if the insurer offers any Medicare supplement product.
• Cancellation (Iowa Admin Rule 191-37.8(1)). Cancellation by the insurer is sharply limited to nonpayment of premium or material misrepresentation.
• Replacement (Iowa Admin Rule 191-37.27). A replacing Medicare supplement insurer must provide a replacement notice; preexisting condition periods do not restart for benefits similar to those in a replaced policy that has been in effect for at least six months (Iowa Admin Rule 191-37.33).
• Guaranteed renewability. Medicare supplement policies are guaranteed renewable; the insurer cannot cancel except for nonpayment or material misrepresentation.

Iowa Long-Term Care Insurance (Iowa Admin Rule 191-39)

Iowa applies the NAIC’s LTC consumer-protection framework with Iowa-specific accents:

• Marketing and training (Iowa Admin Rule 191-39.15). Producers selling LTC products must complete the Iowa-required initial and ongoing LTC training. Iowa adopts NAIC-style marketing standards prohibiting high-pressure sales tactics and cold-lead advertising that doesn’t disclose its commercial purpose.
• Policy provisions (Iowa Admin Rule 191-39.6, 39.10, 39.29 and 39.30). Iowa LTC policies must include defined provisions — guaranteed renewability, inflation protection offer, nonforfeiture offer, eligibility for benefits (typically tied to ADL deficits or cognitive impairment), and benefit triggers.
• Levels of care (Iowa Admin Rule 191-39.9). Iowa LTC policies must address each level of care along the spectrum:
• • Home health care (Iowa Admin Rule 191-39.9). Skilled nursing, therapy services, and home health aide services delivered in the insured’s home.
• • Nursing home (Iowa Admin Rule 191-39.5). Skilled, intermediate, and custodial care delivered in a licensed nursing facility.
• • Assisted living. Residential settings that provide some care and assistance with daily activities.

Iowa Long-Term Care Partnership Program (Iowa Admin Rule 191-39.75 through .85)

Iowa participates in the federal-state Long-Term Care Partnership program. A partnership policy is a qualified LTC policy meeting additional federal and Iowa standards. The advantage is significant:

• Asset disregard. Iowa Medicaid will disregard assets equal to the amount of LTC benefits paid out under a qualifying partnership policy, when determining the insured’s eligibility for Medicaid LTC coverage if the insured exhausts the partnership policy.
• Inflation protection. A partnership policy’s inflation protection depends on the insured’s age at purchase: compound annual protection under age 61, compound or at least 3 percent simple protection from 61 through 75, and none required from 76 (Iowa Admin Rule 191-39.77).
• Producer training. One long-term care training requirement covers partnership policies too; only a producer who completed long-term care training before January 1, 2010 takes a separate one-time course on the partnership program and Iowa Medicaid (Iowa Admin Rule 191-39.15(4)).
• Reciprocity. Most states accept Iowa partnership policies for asset-disregard purposes under cross-state reciprocity agreements.