Tuesday, December 6, 2011

New Rule Restores Health Insurance Market for Children

Oklahoma City – Oklahoma Gov. Mary Fallin on Monday gave her approval to an emergency rule intended to close an insurance gap created by federal health care reform.
For some 18 months, “child-only” policies for ages 19 and under have not been sold by any insurance company doing business in Oklahoma, a response by insurers to new federal regulations in the Patient Protection and Affordable Care Act. Insurance Commissioner John D. Doak said yesterday that Gov. Fallin’s signature should revive that market for the vast majority of uncovered children.
The revised emergency rule permits carriers to determine the age range in which they intend to offer coverage to all applicants during defined enrollment periods. Deputy Commissioner of Health and Life Insurance Mike Rhoads said insurers are expected to resume selling child-only policies for applicants ages 1 to 19.
A special enrollment period for coverage will take place in January and February 2012.
“I applaud Gov. Fallin’s decision to provide coverage options to as many Oklahoma children as possible,” Doak said. “I look forward to health insurers re-entering the Oklahoma child-only market during the new year.”
Doak noted that coverage has always remained available for children of all ages as part of family insurance plans, and that disadvantaged Oklahoma children were still covered by programs like SoonerCare. Child-only insurance is purchased by parents or guardians whose incomes don’t qualify for government programs and who cannot or choose not to buy private coverage for the whole family.
“For 18 months this specific type of coverage has been completely unavailable due to federal interference in the insurance market,” said Doak.

The gap in coverage was created when insurers reacted negatively to provisions within PPACA. According to a United States Senate report issued Aug. 2, 2010, carriers withdrew entirely from offering child-only coverage in Oklahoma and 16 other states. In another 22 states, at least one insurance company stopped offering such policies, reducing access to child-only coverage there, as well.
Doak notes that child-only policies were not canceled for children age 19 and under. Parents and guardians, however, could not buy new policies solely for children, without covering the entire family.
“While this segment of the market is not a large one, it is important,” Doak said. “An example might be a grandparent who is raising a grandchild in the home. The grandparent might already be covered by Medicare and not in need of a family insurance policy, but buying private insurance only for the child or children in the home was no longer an option.”
A rule change that took effect in July and was intended to encourage insurers to re-enter the market for child-only insurance from ages 0 to 19 resulted in a summertime open enrollment period in which no carriers participated.
“Insurers remain reluctant to issue policies for children ages 0 to 1 in a market in which, by federal law, the carrier would be required to accept all applicants, whether healthy or already sick,” Rhoads said. “Companies have indicated to the Oklahoma Insurance Department that they are prepared to re-enter the market for children ages 1 to 19. We will continue working toward solutions that provide more coverage options for the youngest Oklahomans.”
Initial enrollment will take place in January and February 2012, with the usual open enrollment period being from June 1 to July 31 each year.
Doak and Rhoads both note that coverage for infants still is available through family insurance plans.
“If your family is insured and a new child is born with health issues, that child is already covered,” Rhoads said. “This emphasizes the importance of carrying family coverage whenever possible.” 
The Oklahoma Insurance Department, an agency of the State of Oklahoma, is responsible for the education and protection of the insurance-buying public and for oversight of the insurance industry in the state.

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