AHIP Releases Individual Market Guarantee Access Proposal, Announces Support For Third Party Review Of Rescission Decisions

Main Category: Health Insurance / Medical Insurance
Article Date: 21 Dec 2007 - 15:00 PDT

email to a friend   printer friendly   view / write opinions   rate article

One year ago America's Health Insurance Plans' (AHIP) Board of Directors advanced a proposal to provide universal coverage. Today, the Board released a proposal to guarantee access to health care coverage in the individual market and announced support for third party review of rescission decisions and their commitment to limiting pre-existing condition exclusions.

"We are committed to working with legislators and other stakeholders to identify policy solutions to the health care challenges facing our nation," said George Halvorson, Chairman and CEO of Kaiser Permanente and Chairman of AHIP's Board of Directors.

The individual health insurance market continues to be the center of various reform proposals to expand access to health care coverage. Continuing on its mission to improve the accessibility, affordability, and quality of health care in America, in June the AHIP Board established an Individual Market Task Force to examine this issue and put forth both policy and operational recommendations.

The result is a three-part proposal that includes a plan to guarantee access to health care coverage to all Americans, new initiatives to give consumers peace of mind about individual health care coverage, and steps states need to take if they are considering a requirement for universal participation.

"Health plans from across the country came together to address the unique challenges facing the individual health insurance market. We believe that plans and the states, working together, can guarantee access to affordable insurance for everyone in the individual market," said Jay Gellert, President and CEO of Health Net, Inc. and Co-Chairman of the Individual Market Task Force.

"This initiative is a fundamental repositioning," said Karen Ignagni, President and CEO of AHIP. "Our Board is committed to ensuring that no American falls between the cracks of public and private programs and that individuals can have their disputes reviewed by an objective third party."

First, the AHIP Board is proposing a strategy that states can implement now to guarantee access to health insurance to all who seek coverage in the individual market, including those with pre-existing medical conditions.

Under this plan, states should establish Guarantee Access Plans to provide coverage for uninsured individuals with the highest expected medical costs. If an individual is not eligible for coverage through the Guarantee Access Plan, health plans would then provide coverage to that individual on a guarantee issue basis with premiums capped at one-and-one-half times the standard rate.

"Health insurance plans believe that everyone should have access to affordable health care coverage regardless of their health status or income," said Don Hamm, President and CEO of Assurant Health and Chair of the Access Subcommittee. "We look forward to working with states to achieve this goal immediately."

Second, the proposal includes a series of operational reforms to give consumers peace of mind when purchasing individual health care coverage. These include limiting the use of pre-existing conditions exclusions, restricting rescission actions, and establishing a new third-party review process for pre-existing conditions and rescission decisions.

Specifically, the Board is recommending that health plans waive the application of pre-existing condition exclusions for medical conditions that are disclosed and should limit rescission actions to those based on information that should have been included in a complete and accurate response to questions asked in a clear and understandable application.

"Implementing third party review would allow those few individuals whose policies may be cancelled to have their case reviewed by an objective, independent board established by the state," said Mike Abbott, President and CEO of American Enterprise Group and Chair of the Operations Subcommittee. "We believe these reforms will enhance peace of mind for consumers purchasing individual health care coverage."

Third, the new proposal outlines five critical steps that states would need to follow if they seek to achieve universal participation by requiring that every citizen in the state have health care coverage. If a state takes these steps and achieves universal participation, health insurance plans could then guarantee coverage to all applicants, without regard to pre-existing medical conditions.

To achieve universal participation, states would need to develop an insurance coverage verification system; enforce the requirement to purchase and maintain coverage; establish an automatic enrollment process; provide premium subsidies for moderate- and low-income individuals and families; and secure funding for the coverage initiatives from a broad base of sources.

"Given our extensive experience, health plans can provide invaluable assistance to states as they experiment with different health care coverage options," said Charles Baker, President and CEO of Harvard Pilgrim Health Care and Co-Chairman of the Individual Market Task Force.

The private individual health insurance market currently provides coverage to 18 million people who do not have access to employer-sponsored health insurance and are not eligible for public programs. AHIP's new survey of the individual health insurance market will also be released today. The survey found that individually purchased health insurance is more affordable and accessible than may be widely known and that it offers a broad array of benefits.

http://www.ahip.org