The Glamour of Reviewing the New WA State Rules on Short Term Medical Plans

 The feds recently expanded Short Term Medical (STM) coverage to allow for a 12-month policy duration, with renewals. In their version, a policyholder could remain on an STM for up to three years once renewals are taken into account. But, don’t get too excited, states still have the power to restrict these plans, or to outlaw them altogether. Now, Washington state is not one to let a Fed plan stand “as is,” so, to that end, the Office of the Insurance Commissioner (OIC) has been working on their own STM plan rules.

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While I typically limit my regulation reading to final rules, I decided to weigh in on the OIC’s stakeholder draft for STMs because the proposed rules looked to be quite limiting as written.  I found several issues, submitted my comments, and about half of my recommendations were included in the recently proposed rulemaking.  While not glamorous, the changes will help to clarify the rules not only for potential purchasers, but also for the agents tasked with selling the programs.  When I say “not glamorous” I really do mean that. 
 
Recommendations that were added included such exciting provisions as:

• Clarifying the definition of “short term” medical
• Adding specific language further defining pre-existing conditions
• Requiring carriers to express coinsurance in terms of what the member would pay
• Denoting what member costs would apply to the out of pocket maximum
• Adding coverage information to the list of services – including ambulance, lab, x-ray, and physical therapy
• Including specific information regarding provider network limitations

 
Unfortunately, the OIC has not budged on their 3-month maximum duration for STM plans within a 12 month period.  Hopes of a longer duration, or a one-time renewal of the policy, did not come to fruition.  And while the disclosure form will include additional clarifications, I wish the OIC had added more explicit wording into the “Caution Box” at the start of this form, since sometimes that’s the only thing purchasers will actually read.      
 
I don’t expect the final state regulations to change much from this latest version.  Another stakeholder meeting was conducted this week, which looks to have been the last opportunity for comments.  It will still take some time for carriers to decide if they want to offer STM plans in 2019, plus the OIC must approve the carriers’ plans, rates, and disclosure form. Hopefully there will be some options available by the time the Individual Open Enrollment period ends. 
 
For now, I would recommend putting this on your “back burner” since you’ll have Medicare renewals, Individual open enrollment, and most likely a slew of group plans renewing between now and when the final STM rules are released.  We’ll keep you posted once we start seeing any interest in STM plans from the carrier front! And, we’ll keep pestering the OIC as we see issues that need to be addressed or resolved – with the hope of making all our lives easier.