Buying a short-term plan in Montana
- Montana defers to the federal rules for short-term plans.
- Legislation was introduced in 2019 to limit short-term plans to three months, but it did not pass.
- Short-term plans are allowed to have initial terms of up to 364 days, and total duration, including renewals, of up to 36 months (but all of the available plans have maximum terms of six months).
- Montana’s current Insurance Commissioner views short-term plans favorably, while his predecessor did not.
- At least three insurers offer short-term plans in Montana.
Montana defaults to federal short-term rules
Montana published guidance in 2018, clarifying that the state is deferring to federal rules for short-term health insurance plans. The state has also published a series of FAQs about short-term health insurance, including details about state-mandated benefits.
During the 2019 legislative session, Representative Tom Winter (D, Missoula) introduced H.B.503, which would have limited short-term plans to three months. But the legislation did not pass, and Montana continues to allow short-term plans to be issued with initial terms of up to 364 days.
However, there are three insurers that offer short-term plans in Montana, and all of them currently cap their plan terms at six months.
Montana plans can have initial terms of up to 364 days and total duration of up to 36 months
The Trump Administration’s new regulations allow short-term plans to have initial terms of up to 364 days, and total duration, including renewals, of up to 36 months (prior to October 2, federal regulations limited short-term plans to three months in duration, and prohibited renewals).
The state’s guidance indicates a significant number of state regulations and statutes that apply to short-term health insurance plans.
Montana insurance regulators and short-term health insurance plans
From 2009 to 2016, Monica Lindeen was the Commissioner of Securities and Insurance in Montana. Lindeen, a Democrat, was term-limited in 2016 and could not seek re-election that year. Matt Rosendale, a Republican, won the election in 2016 and assumed office as the Commissioner at the start of 2017 (Rosendale also ran unsuccessfully to unseat Senator Jon Tester, a Democrat, in the 2018 election; Rosendale lost that race, so he continues to be Montana’s Insurance Commissioner).
The two Commissioners have differing approaches to health care reform, and to short-term health insurance plans. Lindeen’s office warned consumers early in 2016 about the potential shortcomings of short-term health insurance. Her office also took action against several short-term health insurers and insurance producers in 2016, alleging that they had sold short-term plans to Montana residents without adequate licensing, and without communicating the fact that these plans don’t cover pre-existing conditions, don’t count as health insurance in terms of avoiding the individual mandate penalty, and cannot be considered comprehensive coverage. The issue was resolved with an agreement (finalized three days after Rosendale took over as Commissioner) that premium refunds would be offered to residents who had purchased the policies in question.
Rosendale’s approach is more welcoming of short-term health insurance, which is in line with his general opposition to the ACA. Although he has noted that it’s essential for consumers to be well-informed about what they’re purchasing, he’s in favor of expanding health insurance options “outside the scope of Obamacare regulations” (Rosendale has also championed health care sharing ministries as an alternative to ACA-compliant coverage).
Rosendale believes longer short-term plans will be purchased by people who have been uninsured, and thus isn’t concerned about the potential for short-term health insurance plans to destabilize the existing ACA-compliant market (there’s debate about this — it’s true that people who are uninsured may gravitate to the short-term market, but hundreds of thousands of people nationwide are expected to switch from individual market plans to short-term plans in 2019, in part due to the elimination of the individual mandate penalty).
Which insurers offer short-term plans in Montana?
- Independence American Life
- National General
- UnitedHealthcare (Golden Rule)
As noted above, all of these insurers currently cap their plan terms at six months.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.