Availability of short-term health insurance in Maine

The Maine Bureau of Insurance confirmed that since 2020, when the state implemented strict new rules for short-term health policies, there have been no short-term health insurance plans for sale in Maine.

In 2019, legislation went into effect (LD1260) that sharply limited short-term health insurance in Maine; the new rules took effect January 1, 2020, and are detailed in 24-A M.R.S. § 2849-B (8) and Bulletin 438. The following rules now apply to short-term plans in Maine:

• Short-term plans can only be sold via an in-person meeting. They cannot be sold online or over the phone. Accordingly, there are no longer any short-term plans for sale in Maine via any of the web brokerages that offer short-term plans in other states. Further, the Maine Bureau of Insurance confirmed that there were simply no insurers marketing short-term plans in the state at all as of early 2020, so even brokers who sell meet clients face-to-face cannot offer short-term plans.
• Short-term plans must terminate no later than December 31 of the year in which they’re issued. The later in the year a plan is sold, the shorter its maximum duration can be.
• The combined total amount of time a person can have short-term coverage is capped at 24 months.
• A short-term plan cannot be sold to someone who has had any short-term coverage within the previous 12 months.
• Short-term plans cannot be marketed or sold during the ACA’s annual open enrollment period for individual market coverage (November 1 to January 15 each year), unless the plan is scheduled to end by December 31. So it is permissible, for example, to sell a short-term policy in November that will only cover the person for the month of December. But it would not be permissible to sell a short-term policy in November with a scheduled effective date of January 1 of the coming year.
• The enrollee must be provided with a comparison of the short-term plan versus a qualified health plan (i.e., an ACA-compliant plan), as well as an estimate of how much an ACA-compliant plan would cost after accounting for any subsidies that the person might be eligible to receive to help cover monthly premium costs. The enrollee must also be provided with the dates for the next open enrollment period for ACA-compliant coverage, as well as contact information for the Maine health insurance exchange (CoverME.gov).

The Maine Bureau of Insurance has issued consumer guidance regarding short-term plans and the state’s new requirements. This would be relevant if and when insurers opt to offer short-term health insurance in Maine.

The Maine Bureau of Insurance reviews filings for short-term plans, and there are numerous state mandates that apply to short-term health insurance in Maine —  in addition to the extensive new rules described above.

The state’s short-term plan filing requirements, including applicable mandates, are available here, under “Individual Major Medical Short Term.”

A few notable benefit mandates are mental health parity, PSA testing for men age 50-72 (which is not required to be covered under federal regulations, even on ACA-compliant plans), and outpatient prescription drugs (if there’s a benefit cap it must be at least $1,500/year, and the cost-sharing can’t exceed 50 percent for the insured).

Maine requires short-term plans to have medical loss ratios of at least 50% (see Bureau Rule 940). The ACA requires individual major medical plans to have medical loss ratios of at least 80%, but that federal rule does not extend to short-term plans and the loss ratio calculations are different for short-term plans. Although Maine does have a requirement for short-term plans’ medical loss ratios, it’s well below the average loss ratio for short-term plans nationwide, which is about 67%.

As noted above, Maine implemented strict new rules for short-term plans as of 2020, and no insurers have offered short-term plans in the state since then.

When the Trump administration issued new rules in 2018 to extend the allowable duration of short-term health insurance plans, the Maine Bureau of Insurance reminded consumers that the state had its own regulations pertaining to short-term health insurance in Maine: Although initial terms of up to 12 months were allowed, the total combined term of successive short-term plans could not exceed 24 months.

When the state’s new rules took effect in 2020, some additional requirements were added: A short-term policy cannot be sold to anyone who has had another short-term plan within the past 12 months, and the combined total time that a person can have short-term coverage cannot exceed 24 months. In addition, a short-term plan must terminate no later than December 31 of the year when it takes effect. All of this is somewhat moot however, given that there are no longer any short-term plans for sale in Maine.

Consumers in Maine can buy ACA-compliant health insurance through the state’s Marketplace, CoverME. Four carriers offer coverage through the exchange in 2024.

ACA-compliant plans are purchased on a month-to-month basis, so you can enroll in coverage even for only a few months until another policy takes effect – and if you’re eligible, you may qualify for financial assistance in the form of a premium subsidy.

Maine residents with fairly low incomes may find that they’re eligible for Medicaid coverage.