Buying short-term health plans in Washington State
- Duration of short-term health plans in Washington State is not currently restricted beyond federal regulations.
- New regulations finalized by the Trump Administration allow plans to have terms up to 364 days with total duration (including renewals) up to 36 months.
- The state’s insurance commissioner has announced that tighter short-term regulations will be in place by the end of 2018.
- Proposed regulations include a call for limiting short-term plan duration to three months and prohibiting renewals.
- One insurer offers short-term plans in Washington State.
Duration limits for short-term plans in Washington State
Under current law, the duration of short-term health insurance plans in Washington State is not restricted beyond federal regulations. However, such plans must officially be determined to be short-term limited-duration plans by the Insurance Commissioner and approved prior to being offered for sale. [See RCW 48.43.005 (26)(l).]
Until October 2, 2018, federal regulations limited short-term health plans to no more than three months and renewals were prohibited. But the Trump Administration’s new rules for short-term plans (effective October 2, 2018) allow them to have initial terms of up to 364 days, and total duration (including renewals) of up to 36 months.
Proposed regulations would limit short-term plans
But the new federal regulations are clear in noting that states may impose tighter regulations. And Washington’s insurance commissioner, Mike Kriedler, who has called short-term plans “a poor solution for consumers,” announced in March 2018 that his office would begin the process of rule-making to define short-term plans at the state level.
An outline of the proposed regulations was published in June 2018. The official draft regulation notice was published on August 21, 2018, and public comments were accepted until September 24, 2018.
The proposed regulations call for:
- Limiting short-term plans to three months in duration with no renewals allowed.
- Preventing insurers from selling short-term plans to an applicant who had already had three months of short-term coverage in the prior 12 months.
- Requiring short-term plans to cover a list of basic inpatient, outpatient, and surgical services.
- Requiring short-term plans to continue coverage (with no additional premiums) if the insured is hospitalized on the date that the short-term plan would otherwise have ended. The extension of coverage would last until the patient is discharged from the hospital.
- Limiting the lookback period for pre-existing conditions to no more than 24 months (ie, a pre-existing condition that hadn’t had symptoms or treatment for more than 24 months would not be excluded on the short-term plan).
- A short-term insurer must offer at least one plan with a per-person deductible of $2,000 or lower.
- Banning the sale of short-term plans during open enrollment, if the short-term coverage is to take effect in the coming year. So short-term plans couldn’t be sold in direct competition with ACA-compliant plans during open enrollment.
The Washington Office of the Insurance Commissioner explained that the goal is to have these regulations in place by the end of the year; the new rules would apply to plans effective January 1, 2019 or later. But they noted that if the public comments on the proposal indicate a high level of controversy, it’s possible that the regulations could be postponed or altered.
One insurer offers short-term plans in Washington
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.