The Trump administration has strongly supported alternative insurance plans in the individual market or those that do not meeting regulatory requirements, for example providing what are defined as "essential health benefits," under the Affordable Care Act. (While the administration claims the ACA reforms are responsible for higher premiums, research shows price increases are largely due to the uncertainty caused by unending efforts to repeal the ACA, the elimination of the individual mandate and the White House's decision to end subsidies to marketplace plans.) In 2017 the president issued an Executive Order instructing federal agencies to expand the scope of what are termed Short Term Limited Duration Insurance (STLDI) plans. (A related rule was finalized in 2018, various entities filed suit opposing the final rule's STLDI expansion and this past Friday, the DC US District Court ruled 2-1 in favor of the government.) Related to STLDI plans and much less discussed are what are termed Health Care Sharing Ministries (HCSMs). Though these are not defined as health insurance plans, for example they do not guarantee payment of claims, they are marketed as such. While HCSM plans are growing in number and in subscribers they are neither regulated at the federal nor state level. Nevertheless, the Trump administration has recently published a proposed IRS rule that would treat HCSMs the same as health insurance, i.e., allow individuals to deduct their monthly HCMS fee from their personal income taxes or be reimbursed under a Health Reimbursement Arrangement.
During this 21 minute conversation Prof. Volk begins by discussing the history of HCSMs. She describes or defines HCSM plans, what benefits they offer, how they're financed and marketed. She explains the adverse selection problem they present, why they are neither regulated at the federal or state level and the recently proposed IRS regulations that would, if finalized, grant tax advantages to those purchasing HCSM plans.
Ms. JoAnn Volk is a Research Professor at the Georgetown University Center on Health Insurance Reforms (CHIR). There she directs research, authors papers, and provides technical assistance on state and federal regulation and legislation governing private health insurance, including health insurance marketplaces under the Affordable Care Act. Prior to joining Georgetown, Ms. Volk represented the AFL-CIO before Congress and the Administration on a broad range of health care issues. Before that, she conducted health care research at Abt Associates and served as an aide to the Speaker of the New York State Assembly. Ms. Volk serves as a consumer representative to the National Association of Insurance Commissioners and is a member of the Committee on Performance Measurement at the National Committee for Quality Assurance (NCQA). She earned an MA in Public Policy from Johns Hopkins University and a BA from Franklin and Marshall College.
The related November 2019 Congressional Research Service paper concerning HCSMs and STLDI plans is at: https://www.everycrsreport.com/files/20191113_R46003_be3db11a1571c61865168353aefa8cb572dc32dc.pdf.
Prof. Volk's 2018 Commonwealth Fund HCSM issue brief is at: https://www.commonwealthfund.org/sites/default/files/2018-08/Volk_hlt_care_sharing_ministries.pdf.
Prof. Volk's June 2020 CHIR Blog post regarding the proposed HCSM IRS rule is at: http://chirblog.org/new-federal-guidance-requires-taxpayers-subsidize-health-care-sharing-ministries/.
For a discussion of the July 17th US District Court's decision regarding the administration's final STLDI rule, see Katie Keith's July 19th review at: https://www.healthaffairs.org/do/10.1377/hblog20200719.720906/full/.