Considering A Multi-State Health Plan? Experts Say Read The Fine Print

Nov 16, 2016

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Consumer advocates are advising people to not buy into the name “multi-state” plan when shopping for individual market health insurance for next year because the plans don’t necessarily offer coverage across state lines.

Susan McConkey, a health insurance broker, said many consumers assume “multi-state” means coverage across state lines at in-network prices. But that isn’t true in most states, including Kentucky.

“They think they can use it in any state, and that’s not the case,” McConkey said.

The Office of Personnel Management in Washington, D.C. was assigned the task of getting insurers to offer these plans because of the agency’s experience managing federal employee health insurance.

Beth Hadley is in charge of multi-state plans at OPM. She acknowledged that the name is misleading, and said the agency is considering changing the name.

“The name implies that coverage will be available to an enrollee in more than one state or out of their network,” she said. “That is sometimes the case, but it’s not a requirement.”

She said 36 states offered multi-state plans in 2015; in 2017, 22 states will offer the plans, including Kentucky.

Anthem spokesman Mark Robinson said 10 percent of the company’s 70,000 individual market members in Kentucky are enrolled in such plans. He said they offer the same benefit levels, but don’t have a competitive advantage in offering lower premiums or co-pays.

That’s because the Affordable Care Act required insurers to base prices on every person in the individual market, and doesn’t allow multi-state plans to be broken out separately.

Sabrina Corlette with the Georgetown University Health Policy Institute says the original intent was to insert more competition into the insurance market, resulting in lower premiums and better benefits. But that hasn’t happened because the insurers offering exchange and multi-state plans are the same. For instance, Anthem is the only insurer offering a multi-state plan in Kentucky; they also are the only insurer offering plans on the exchange in many counties here.

“There’s no real difference or even in the type of cost sharing you might see,” Corlette said. “It’s hard to state really what value they add, but to perhaps confuse consumers.”

President-elect Donald Trump has vowed to dismantle the ACA, which would likely include multi-state plans. But he’s also said that whatever replaces individual market plans will go in place immediately so that there’s no disruption of coverage.

That means consumers have at least next year to keep their coverage, and to double-check multi-state plan coverage.

The deadline to apply for coverage that starts January 1 is December 15.