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BLOG — Solving the Coverage Puzzle: Health Premium Grace Period Protection

by Tricia Barrentine Guay

More than 262 million Americans access medical care through a private health plan, either provided by an employer or through Exchanges, Medicaid and Medicare Advantage run by carriers. The Alliance of Community Health Plans (ACHP) has proposed several novel approaches to ensuring access to care, maintaining continuity of coverage and stabilizing the health insurance market in the face of this unprecedented public health emergency.  Protecting providers and plans from significant losses due to state-mandated grace periods for health premiums is one piece of the puzzle to address access, continuity of coverage and market stabilization issues created by the COVID-19 emergency.

Health Premium Grace Period Protection

As hundreds of thousands of Americans seek treatment for COVID-19, providers and health plans are bracing for unknown financial challenges, including uncompensated care bills for the uninsured. ACHP encourages Congress to take steps to ensure that there is no disruption in coverage and care to consumers once the grace periods have ended.

At a time when many Americans are facing income instability, 16 states have mandated grace periods, providing up to 90 days of relief to companies and individuals who are not able to pay their monthly health premiums.

During this time, health plans are prohibited from cancelling health coverage for non-payment and must continue to pay claims on these policies. These grace periods are an important tool, helping ensure that individuals can remain covered, but they may have unintended consequences.

Congressional protections, including reimbursement for health plan coverage not paid for by an enrollee or employer following the grace period, is critical to a plan’s long-term stability. This would help employees maintain existing coverage and access to their regular health care providers.

Our non-profit community health plans are on the frontlines of mitigating this public health emergency and willingly complying with state-mandated grace periods.  In fact, several ACHP members are implementing self-imposed grace periods to ensure continuity of coverage for those who are struggling. ACHP plans continue to honor capitation agreements and pay providers without holding claims regardless of premium status.

As health plans continue to provide coverage and pay providers it is important that they maintain their long-term stability for the communities they serve.  Congressional action to support these providers and plans following the grace period is critical to ensuring coverage and care for millions of Americans in this unprecedented time.

For any questions, reach out to Tricia Barrentine Guay at tguay@achp.org.