House Energy and Commerce Committee Chairman Frank Pallone (D-NJ) announced on Wednesday that they are launching an investigation into possible discriminatory practices of short-term, limited-duration insurance plans (STPs). The investigation of a dozen issuers is specifically looking at the ability to exclude from coverage or charge higher premiums to consumers with a pre-existing condition, or to mislead consumers into believing that this coverage complies with the ACA. House Democrats introduced legislation last month to repeal the Trump Administration’s regulation expanding STPs and restore the three-month maximum imposed under the Obama Administration.|
The STP rule was published last August and effectively ended the policy established by the Obama Administration in 2016 restricting the length of time for STPs. The Trump Administration instead extended eligibility for the plans from a maximum of three months to up to 364 days as previously permitted, with the ability to renew coverage for a duration up to 36 months at the carrier's discretion. NAHU sought several consumer protections that were ultimately included in the final rule, including requiring insurers to clearly disclose the type of policy the individual is choosing, the coverage’s limitations, that these plans do not offer the same coverage as individual plans under the ACA and they do not satisfy the requirement for minimum essential coverage. We continue to stress that consumers enrolling in such coverage should be fully aware of the significant limitation of these policies.
Last month, the Energy and Commerce Committee held a hearing on legislation to limit or rescind the STP and other Trump Administration regulations designed to expand coverage outside of the ACA. This included H.R. 1010, introduced by Representative Kathy Castor (D-FL) to reverse the Trump Administration’s expansion of short-term plans, and H.R. 1143, introduced by Representative Anna Eshoo (D-CA), that would require short-term plans to disclose their risks to prospective consumers, including disclosure that these plans may not cover preexisting conditions or the costs of medical services, and that coverage may be rescinded if the individual seeks treatment for a preexisting condition. Despite the relatively partisan nature of the hearing, there was bipartisan consensus among committee members that insurers should be required to disclose the risk of short-term plans.
As part of the newly launched investigation, insurers are being asked to respond with their underwriting documents, marketing materials, health questionnaires, brokers’ compensation arrangements, and any complaints they've received from insurance regulators or consumers. The insurers that are being investigated include: Agile Health Insurance, Anthem Blue Cross Blue Shield, Arkansas Blue Cross Blue Shield, Blue Cross of Idaho Group, Cambia Health Solutions, EHealth, Everest, Health Insurance Innovations, Healthcare Solutions Team, Independence Holding Company, National General Insurance and UnitedHealth Group.