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Federal health insurance regulators, and many state insurance regulators, are trying to keep COVID-19 economic disruption from leaving Americans without insurance.

The Centers for Medicare and Medicaid Services (CMS) has posted guidance that could help the carriers that sell coverage through the Affordable Care Act exchange system offer premium payment grace periods.

State officials have also been posting insurance premium grace period notices.

Resources

  • A copy of the CMS guidance allowing for health insurers to offer grace periods is available here.
  • A copy of a California notice requesting grace periods is available here.
  • A copy of an Ohio bulletin that includes a grace period provision is available here.
  • A copy of a Washington state order that includes a grace period provision is available here.
  • An article that lists some of the grace periods life and health insurers offered for people affected by Hurricane Katrina is available here.

A grace period gives policyholders extra time to make premium payments.

Some policies have built-in grace period provisions.

State insurance regulators have requested or required special grace periods in the past for residents affected by major natural disasters, such as Hurricane Katrina.

CMS — the arm of the U.S. Department of Health and Human Services that runs HealthCare.gov and other Affordable Care Act insurance programs — posted a grace period memo Tuesday.

The CMS memo is aimed at health insurers that sell individual, family and small-group coverage through HealthCare.gov.

In the memo, Randy Pate, director of the CMS Center for Consumer Information and Insurance Oversight, says that, during the COVID-19 national emergency, “CMS will exercise enforcement discretion” if a health insurer helps keep a consumer covered by providing a premium payment grace period extension that would not normally be allowed under HealthCare.gov rules.

“CMS encourages state-based exchanges to take a similar approach,” Pate says.

California, Ohio and Washington state are some of the states that are seeking or imposing COVID-19-related grace periods.

California Insurance Commissioner Ricardo Lara has asked all insurance companies to provide policyholders with at least a 60-day premium payment grace period. The request covers life insurance and property and casualty lines as well as health insurance.

Jillian Froment, director of the Ohio Department of Insurance, has ordered health insurers and state-regulated group health plan issuers in Ohio to provide a grace period for premium payments.

“All insurers are to give their insureds the option of deferring premium payments coming due, interest free, for up to 60 calendar days from each original premium due date,” according to the Ohio grace period bulletin.

Mike Kreidler, the Washington insurance commissioner, is requiring health insurers to provide a 60-day grace period for consumers who buy individual coverage through the ACA system without subsidies or who buy individual, family, or fully insured group plans outside of the ACA exchange system.

“Insurers may choose to extend the grace period beyond 60 days, but if they do so the extension must apply to all enrollees,” according to the Washington statement grace period announcement.

Washington state officials note that people who use premium subsidies to pay for ACA exchange plan coverage automatically get a 90-day payment grace period.

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