Changes to Short-Term Medical Insurance in WA State
GHB’s WA Healthcare Series, Part 2:
Short-term Medical insurance is true accident-and-illness coverage.
It does not provide coverage for preventative care (annual physical, immunizations, colonoscopy, mammogram, annual women’s visit, et cetera) or any pre-existing care. It had become an increasingly popular alternative to comprehensive individual ACA-compliant plans over the past few years, as premiums come at significantly less cost, comparatively.
Note that Short-Term Medical is not a replacement for ACA-mandated insurance, in that it is not considered Minimum Essential Coverage (MEC). Therefore, an individual or family would still be on the hook for paying the individual penalty if they carried this coverage instead of ACA mandated insurance (requires 10-out-12 months enrolled in MEC to satisfy mandate).
On October 2, 2018 new federal regulations finalized by the Trump Administration allow Short-Term plans to have terms up to 364 days with total duration (including renewals) up to 36 months.*
Previously, you could carry a Short-Term Medical plan for three months and renew once-a-year for up to an additional three months.
What about in Washington State?
However, in Washington State, the Office of the Insurance Commissioner has proposed tighter regulations from what currently exists. In Washington State, these new regulations mean you would only be able to enroll in a short-term plan for up to three months in duration with no renewals allowed. Additionally, Insurers would be prevented from selling a short-term plan to an applicant that had enrolled in one of these plans in the previous 12 months. The selling of these plans would also be banned during open enrollment (November 1 – December 15, for a 2019 effective date) as to not detract Washingtonians from enrolling in ACA coverage.
The Office of The Insurance Commissioner hopes to have the regulations in place effective January 1, 2019.
What we’ve seen in the past years since the ACA entered is a mass exodus of Short-Term Medical Insurers from Washington State. Currently, we are now down to one carrier, LifeMap Assurance Company.
Our office has written a lot of Short-Term Medical coverage over the past few years. It is still a very useful solution for people needing health insurance for a short duration. For example, if you’ve just changed jobs and need some sort of affordable coverage for a few months during your probationary period with your new employer.
The proposed changes would dramatically impact Washingtonians who have been using Short-Term Medical as an alternative to MEC.
*Norris, Louise. (2018, October 1). Short-term health insurance in Washington State. Retrieved from https://www.healthinsurance.org
Casey Meehan is GHB’s Individual Market Specialist and is the President of a Regional NAHU Chapter.