Government

Iowa Insurance Division approves sale of more short-term health plans

Five insurance carriers now set by state

Doug Ommen

Iowa Insurance Commissioner
Doug Ommen Iowa Insurance Commissioner

The state’s insurance regulator has approved the sale of more short-term limited-duration health plans in Iowa, a move officials say is meant to help Iowans who have been priced-out or failed to enroll in the federal Affordable Care Act.

The Iowa Insurance Division announced Monday it has approved five insurance carriers to sell short-term limited-duration plans in 2020. Officials also announced they are working with “several other carriers” to approve more plans for sometime in the future.

These companies are authorized to sell plans that can be used for up to 364 days and are renewable for up to three years, according to the Iowa Insurance Division’s website.

The five insurance companies approved by the Iowa Insurance Division to sell these health plans are:

• Companion Life Insurance

• First Chicago Insurance

• Golden Rule Insurance

• National Health Insurance

• United States Fire Insurance.

Plans sold by Golden Rule, National Health and United States Fire are available for two renewals, but plans sold by First Chicago and Companion Life are not available for renewal.

Two of the five carriers were approved by the division in September for the sale of these plans.

Short-term limited-duration health plans were created for individuals experiencing a temporary gap in their health insurance coverage, such as those between jobs or young adults coming off their parents’ plan.

“Contrary to some national talking points, all short-term limited-duration policies are not ‘junk’ plans,” said Iowa Insurance Commissioner Doug Ommen in a statement Monday. “Every state has the authority to ensure minimum standards and consumer protections.

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“Under Iowa’s administrative rules, short-term limited-duration policies are a viable health coverage option, especially for the many Iowa consumers priced out of the ACA individual health insurance market.”

Under previous ACA law, these plans were not renewable beyond three months. However, in October 2018, a new federal rule went into effect that extended the duration of short-term limited-duration plans to 12 months and allowed insurers to renew or extend coverage for up to 36 months.

The Iowa Insurance Division adopted administrative rules, allowing these plans in Iowa in February 2019. According to the insurance regulator, these plans are required under state regulations to “provide consumers with a base set of benefits, out-of-pocket maximums and a minimum level of coverage.”

“While short-term limited-duration coverage was previously meant to fill small gaps, due to the unaffordability of ACA coverage, we’ve worked hard with carriers and other stakeholders to develop common-sense regulations at the state level that will help provide meaningful health coverage to Iowans at a price they can afford through short-term limited-duration plans,” Ommen said in a statement.

Consumers who purchased short-term limited-duration health plans that are not compliant with state regulations before Jan. 1 may continue to use their plan until the end of the term, which should not go beyond the end of March of this year, according to the Iowa Insurance Division.

Comments: (319) 368-8536; michaela.ramm@thegazette.com

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