Insurers will have to scramble to revamp policies aimed at helping U.S. residents fill health coverage gaps, according to a limited-benefit market executive.
Brian Robertson, executive vice president of Fringe Benefit Group Inc., Austin, Texas, talked about the prospects for limited-benefit health insurance products in an interview expanding on a commentary his firm released earlier this week.
Only about 1 million U.S. residents have any kind of limited-benefit product, and that limits the ability of insurers and producers in the market to get the attention of anyone in Washington, Robertson says.
The result: Provisions in the Affordable Care Act – the legislative package that includes that Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act – will ban the sale or renewal of health insurance products that put annual or lifetime limits on benefits.
In practice, that means issuers of existing limited-benefit products that are regulated as group health insurance products will have to impose drastic price increases or drop the products, Robertson says.
Congress adopted the benefits caps in reaction to stories about patients insured by major medical plans who found that the plans covered far less care than the patients had expected. Few members of Congress appear to be aware of insurer efforts to sell low-cost, clearly explained products that help people who cannot buy conventional major medical coverage, Robertson says.
Products that are filed as supplemental indemnity health insurance products and are not subject to Employee Retirement Income Security Act requirements appear to be safe, Robertson says.
