The public exchanges run by the U.S. Department of Health and Human Services (HHS) will be forgiving to consumers who fail to pay their 2014 exchange plan premiums.
When a consumer fails to pay the premiums for qualified health plan (QHP) coverage purchased through an HHS public exchange, the issuer is supposed to cancel the coverage. When, however, the 2015 open enrollment period rolls around, the consumer can apply for coverage from any available QHP — including the QHP that the consumer stiffed this year.
When the consumer starts paying for the 2015 QHP coverage, the issuer cannot use any of the consumer’s new payments toward paying off the outstanding debt from the old, terminated, 2014 coverage, according to officials at the Centers for Medicare & Medicaid Services (CMS).
CMS — an arm of HHS — gives the rules that apply to consumers who have failed to make timely payments for QHP coverage in a new batch of advice aimed at agents, brokers and other exchange helpers. The information sheet applies directly to exchanges established or managed by HHS. It could have an indirect effect on the rules managers of state-based exchanges adopt.
See also: Dear HIX: What if a payment is late?
In states with HHS-run exchanges, consumers who are getting the Patient Protection and Affordable Care Act (PPACA) premium subsidy tax credit get a three-month grace period when they fail to make timely premium payments. Consumers who are not getting premium tax credit help get whatever grace period state rules require.
Consumers who fail to make premium payments by the end of the grace period will lose their 2014 QHP coverage. In some cases, CMS officials say, the consumers may qualify for the special enrollment periods (SEPs) available to people who go through major life events, such as a marriage or the birth of a child, or have other reasons to qualify for SEPs.
If a consumer who failed to pay for 2014 QHP coverage and loses the coverage qualifies for a SEP, the consumer can buy new QHP coverage either from the same insurer or from one of the insurer’s competitors. If the consumer uses the SEP to get the same QHP coverage back, the insurer cannot use any of the consumer’s payments for new coverage to pay back the debt left over from the old, terminated coverage, officials say.
Officials also give analyses of five other QHP loss situations.