In Mass., Customers Buying Short-Term Insurance Increases Costs For All

The Boston Globe: "Thousands of consumers are gaming Massachusetts' 2006 health insurance law by buying insurance when they need to cover pricey medical care, such as fertility treatments and knee surgery, and then swiftly dropping coverage, a practice that insurance executives say is driving up costs for other people and small businesses."  These consumers' medical spending "while insured was more than four times the average for consumers who buy coverage on their own and retain it in a normal fashion. … The problem is, it is less expensive for consumers — especially young and healthy people — to pay the monthly penalty of as much as $93 imposed under the state law for not having insurance, than to buy the coverage year-round."

Recent legislation filed by Gov. Deval Patrick would only allow people to enroll in insurance coverage two times per year on the individual market and would allow waiting periods before coverage begins. "But insurers say stronger action is needed. Consumer advocates caution, however, that many people who sign up for short-term coverage may merely be between jobs" (Lazar, 4/4).

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