Trump administration officials have published a new guide for agents and brokers who help consumers apply for health coverage through the new HealthCare.gov special enrollment period process.
The Centers for Medicare & Medicaid Services recently responded to insurer concerns about SEP fraud by requiring just about all applicants for SEPs to document their need for a SEP. CMS has added a link to a major new section on the SEP documentation requirements to the front page HealthCare.gov website.
In the new guide, officials give detailed examples of what kinds of consumers qualify to buy health coverage through a SEP and which do not.
Consumers who have lost employer coverage, moved or enrolled in a plan that violates a major contract provision can qualify for SEPs, officials say.
Voluntarily dropping other coverage, being terminated from other coverage for failure to pay the premium bills, and being terminated from other coverage for fraud are not reasons that qualify a consumer for a SEP, officials say.
“Moving only for medical treatment or staying somewhere for vacation doesn’t qualify consumers for a SEP,” officials say, several times.
Drafters of the Affordable Care Act eliminated most of the underwriting rules, benefits design practices and other strategies insurers once used to hold down medical claim risk. Policymakers worried that the new rules would encourage some healthy consumers to wait until they got sick to pay for coverage.
To discourage “free riders,” regulators, insurers and ACA public exchange managers developed an “open enrollment period” system, or system for limiting when people can buy individual major medical coverage without showing they have what the government classifies as a good reason to ask for a SEP.
The open enrollment period for 2017 coverage ended Jan. 31, and the open enrollment period for 2018 is not scheduled to start until Nov. 1. All consumers who want to get individual major medical coverage now must qualify for a SEP.
Patient advocacy groups have criticized the new SEP documentation rules, arguing that they may hurt poor, disorganized people while doing little to screen out people with known, serious health problems who are intent on committing application fraud.
Consumers who want individual health insurance and do not qualify for a SEP can still buy short-term health insurance, because regulators have ruled that the ACA major medical insurance rules do not apply to short-term health insurance. Because short-term health insurance does not fall under ACA rules, issuers can limit annual and lifetime benefits, choose what types of care they want to cover, and use medical underwriting. Young, healthy people can buy short-term health insurance in most states for much less than the full retail price of individual major medical coverage, but people with health problems may not be able to buy the product at all.
— Read CMS Draft Attracts Few Enrollment Abuse Stories on ThinkAdvisor.