Well-designed coverage access guarantees help industry

Last week during a Senate hearing, Janet Trautwein talked about what sounds like a great starting point for overhauling the current guaranteed-issue health coverage system.

Related: Tavenner asks Congress to save 2018 individual health market

Trautwein described a proposal, which has come up before, that would let people who get and keep a minimum level of health coverage continue to be major medical coverage policyholders without worrying about medical underwriting affecting their access to coverage, or doing much to affect the cost of their coverage.

The government would set up risk pools, or special insurance plans for high-risk people, but only for people who failed to maintain continuous coverage, according to a written version of her remarks posted on the hearing website.

The continuous coverage rules would, presumably, be less complicated than the Health Insurance Portability and Accountability Act of 1996 continuous coverage requirements. The HIPAA continuous coverage requirements seemed to give continuous coverage credit only to consumers who had been enrolled in group major medical coverage for all of their 100 lives.

The HIPAA credit seemed to give the eligible consumers access to affordable coverage only if they could figure out how to travel faster than light, back through time, to a special health insurance agency in another, nicer universe than this one.

And, of course, the devil is in the details. It’s hard to know in health insurance what will really protect health insurers against plan-killing antiselection pressure. The continuous coverage requirements Trautwein described might be too weak to help health insurers much.

But what’s nice about the version of the requirement that Trautwein described is that it lets people be honest.

Health insurers and employers now have all sorts of wellness and chronic condition management programs that hinge on a health plan having complete information about an employee’s health. (Photo: iStock)

The sorts of people who have no idea what a deductible is might blithely give the programs complete information in exchange for a $20 gift card, no matter how health insurance rules change.

If Congress returns us to where we were in 2008, and many states impose no medical underwriting restrictions on health insurers whatsoever, then people who have manageable near-term health costs have a huge incentive to hide health risk from insurers and employers.

Related: What every broker needs to know about the big 3 diseases