MOUNTAIN VIEW, Calif.,
Aug. 1, 2018 /PRNewswire/ -- The
Trump administration has issued a new regulation today that
reverses the prior administration's 2017 rule limiting short-term
health insurance coverage to less than three months. The new
regulation allows each state to assess the needs of its residents
and set its own coverage period, with the maximum being less than
12 months. State-specific regulation had been the norm in the
short-term health insurance market for its three-decade existence,
and the majority of states had allowed a maximum coverage period of
364 days prior to the Obama administration's restriction, which
went into effect on April 1,
2017.
Renewals and extensions of short-term policies are capped at 36
months under the new regulation and may be done "without any
medical underwriting or experience rating beyond that completed
upon the initial sale of the policy."
The new regulation, which goes into effect 60 days after it is
published in the Federal Register, will be welcomed by the
uninsured as well as millions of existing and former short-term
policyholders. The change will also receive an enthusiastic
reception from a diverse range of policymakers and industry thought
leaders who have championed the elimination of the 2017 regulation.
Last year, 14 U.S. senators led by Sen. Ron
Johnson asked for the three-month restriction on short-term
plans to be rescinded. Other organizations that objected to the
three-month rule included the National Association of Insurance
Commissioners (NAIC), the National Association of Health
Underwriters (NAHU), and the state departments of insurance in
Georgia, Illinois, Kansas, Louisiana, Nebraska, Oklahoma, and Wisconsin. HealthPocket submitted a white
paper and several comment letters to the Centers for Medicare and
Medicaid Services (CMS) documenting the consumer harm caused by the
3-month rule. AgileHealthInsurance.com also submitted formal CMS
comments and published industry statistics that dispelled many
myths that were mischaracterizing this product and its
purchasers.
Under the 2017 Obama restriction, consumers needing temporary
coverage would have to reapply for insurance every three months. In
practice, this meant that if a person were unemployed for seven
months and lost employer health benefits, he or she would need to
apply three separate times. Each re-application reset the
deductible so that prior medical spending no longer counted.
Additionally, any medical condition from the prior three months
became uncovered since, as interim coverage used for less than a
year, short-term plans' economic model only insures conditions that
happen during the policy's duration period. It is expected that
most health insurance companies currently selling short term plans
will start marketing one-year plans by the new implementation date,
and that the new regulation will encourage many highly-respected
health insurers to return to the short term market and start
selling new one-year plans of their own.
"The short-term regulation issued today by the departments of
HHS, IRS, and Labor is extremely pro-consumer and recognizes our
country's need for a strong gap health insurance market,
particularly in this period of disruption for the Affordable Care
Act," said Bruce Telkamp, founder
and CEO of AgileHealthInsurance.com and HealthPocket, Inc.
"Politics aside, it's beyond debate that scant insurance company
participation and ever-increasing premiums for unsubsidized
Obamacare plans have pushed millions of consumers out of government
health exchanges. One year short-term plans will bring immediate
relief to consumers needing low premiums and unrestricted provider
network coverage so they will not join the ranks of the
uninsured."
For more than 30 years, short-term health insurance has served
as the fundamental bridge for individuals and families going
through insurance lapses caused by job loss, a change in Medicaid
eligibility, college graduation, summer vacation, or retirement
before Medicare enrollment. These plans are significantly less
expensive than exchange health plans and can be purchased any time
of year. Their core benefits range from doctor and specialist
visits to hospitalization and emergency care. Their unrestricted
network model also provides the maximum breadth of healthcare
provider acceptance. Insurance applications are medically
underwritten by the insurance company so acceptance is not
guaranteed but prior industry analysis has found nearly 90% of
applicants were approved for coverage. Additionally, health
conditions that arose prior to the beginning of coverage are not
paid by the plans.
Kev Coleman, Head of Research
& Data at HealthPocket commented, "The enactment of the
three-month restriction in 2017 by the Obama administration failed
to improve Affordable Care Act enrollment as hoped and, instead,
hurt short-term policyholders financially by resetting their
deductibles multiple times per year. These multiple resets added
thousands in out-of-pocket burdens unnecessarily. The return of
short-term products in their traditional form comes at a crucial
time since these plans not only provide gap insurance, but also
provide a safety net to keep unsubsidized consumers insured when
they are priced out of the Obamacare market and lack suitable
alternative coverage in their area. The plight of the unsubsidized
will become even more challenging in 2019 given that the
Congressional Budget Office has predicted a 15 percent premium
increase for exchange plans. This increase will only apply to the
unsubsidized since subsidized buyers pay a fixed percentage of
monthly income. Regarding the potential impact of this increase, a
recently published government study found that the 21 percent rise
in 2017 Obamacare premiums was met with a 20 percent decline in
enrollment among unsubsidized consumers compared to only a three
percent enrollment decline among the subsidized."
AgileHealthInsurance.com was launched in 2015 to
educate consumers on the availability of private market health
insurance products that are alternatives to Affordable Care Act
(Obamacare) plans. Today AgileHealthInsurance is the largest
distributor of short-term health insurance, providing
a fast, online process for purchasing these plans. Short-term
health insurance is a flexible and low-cost major medical insurance
for individuals without expensive pre-existing health conditions.
It is not Obamacare. Short-term health plans offer consumers the
flexibility to choose health plans with the benefits that matter
most to them and combine these benefits with broad provider
networks. Additional information about AgileHealthInsurance can be
found at www.AgileHealthInsurance.com.
AgileHealthInsurance is a Silicon Valley-based technology
company and an independently managed division of Health Insurance
Innovations, Inc. (Nasdaq: HIIQ). AgileHealthInsurance and its
executives hold licenses in all 50 states and D.C. to transact
health insurance online. This press release contains
"forward-looking statements" within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements are statements other than historical fact, and may
include statements relating to goals, plans and projections
regarding new markets, products, services, growth strategies,
anticipated trends in our business and anticipated changes and
developments in the United States
health insurance system and laws. Forward-looking statements are
based on our current assumptions, expectations and beliefs are
generally identifiable by use of words "may," "might," "will,"
"should," "expects," "plans," "anticipates," "believes,"
"estimates," "predicts," "potential" or "continue," or similar
expressions and involve significant risks and uncertainties that
could cause actual results, developments and business decisions to
differ materially from those contemplated by these statements.
These risks and uncertainties include, among other things, our
ability to maintain relationships and develop new relationships
with health insurance carriers and distributors, our ability to
retain our members, the demand for our products, the amount of
commissions paid to us or changes in health insurance plan pricing
practices, our ability to integrate our acquisitions, competition,
changes and developments in the United
States health insurance system and laws, and our ability to
adapt to them, the ability to maintain and enhance our name
recognition, difficulties arising from acquisitions or other
strategic transactions, and our ability to build the necessary
infrastructure and processes to maintain effective controls over
financial reporting. These and other risk factors that could cause
actual results to differ materially from those expressed or implied
in our forward-looking statements are discussed in HIIQ's most
recent Annual Report on Form 10-K filed with the Securities and
Exchange Commission (SEC) as well as other documents that may be
filed by HIIQ from time to time with the Securities and Exchange
Commission, which are available at www.sec.gov. Any forward-looking
statement made by us in this press release is based only on
information currently available to us and speaks only as of the
date on which it is made. You should not rely on any
forward-looking statement as representing our views in the future.
We undertake no obligation to publicly update any forward-looking
statement, whether written or oral, that may be made from time to
time, whether as a result of new information, future developments
or otherwise.
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SOURCE AgileHealthInsurance.com