HHS Moves to Address Carrier Losses by Tightening Up "Special Enrollment Periods" for ACA Exchanges

January 22, 2016

Responding to carrier concerns about ACA exchange enrollees gaming the system, the Department of Health and Human Services announced this week it would eliminate six special enrollment period categories to limit the ability of people to wait until they are sick to sign up, only to drop coverage after receiving treatment.  According to Kevin Counihan, CEO of HealthCare.gov, the ACA exchanges have to work well for consumers, but they also "must be attractive for insurance companies that offer plans on [them]."  Under the new rules, the special enrollment periods (SEPs) that are no longer available include:

• People who were eligible for or enrolled in COBRA and not sufficiently informed about their coverage options;
• People who were previously enrolled in the Pre-Existing Condition Health Insurance Program; and 
• People who were affected by an error in the treatment of Social Security Income for tax dependents.

The move by HHS occurs as several insurance companies offering coverage on the exchanges announced they were losing hundreds of millions of dollars on those plans.  However, it is not clear how much the new rules will limit gaming, because at this point SEP applicants are not required to prove their eligibility and simply have to check a box on the form claiming eligibility.